USD/CAD Daily Forecast – Resilient Pair Aiming 1.3133 Key Resistance

The Loonie pair displayed a slight upward movement in the early hours, possessing some slow-growing momentum. The pair quite remarkably breached the 1.3109 resistance mark last touched earlier this month. Ahead of the day, on moving further upwards, the pair might experience strong resistance near 1.3129 and 1.3136 levels.

The US Dollar Index was also revolting against some sound resistance points in the Asian session. The Greenback was under rigorous attempts since last few days to break the 97.43 resistance mark.

Anyhow, today, the US Dollar appeared surpassing the aforementioned barrier and lingering near 97.47 level. The most significant 200-day SMA remains stalled near 96.64 level, ensuring major support on the downside.

On the Crude front, the overall picture appears a bit gloomy, tending to move downwards.

The Crude Oil WTI Futures had already crossed and moved below the 50-day SMA, shifting the target towards mid-term 100-day SMA, moving near 57.10 mark. The prices remain under due pressure on the backdrop of increasing economic sluggishness as the US-Sino trade dispute heads into the second year.

Significant Economic Events

Two Canadian low-volatile events line up for release in the early European session. Out of which, the market stays slightly bullish on the June YoY Housing Starts. On the other one, the May MoM Building Permits, the Street analysts remain highly bearish this time.

Meantime, all the market participants stay attentive to the Fed’s Chair Powell’s Speech scheduled at around 12:45 GMT. After the release of a stronger-than-expected Jobs report last week, the odds of a Fed rate cut hold increased drastically. Despite that, the investors seem to expect a rate cut later this month. People think rate cut as a good thing for them, but they completely ignore the reason behind the implication. Rate cuts usually take place when there are signs of turmoil in the overall economy.

Traders must also keep an eye over the API Weekly Crude data computed since July 5. This Oil report would come out at around 20:30 GMT.

Technical Analysis

The USD/CAD pair had already showcased some resilient movements in the morning session, breaking some key resistances. Now, further upward drift would enable the pair to challenge the 1.3133 handle. Meanwhile, the RSI was pointing towards 73.39 level, revealing buyer domination.

However, any drowning effect in the pair’s movements would be taken care of by the support conflux made up of various significant SMAs. Anyhow, at any point in time, the over-bought RSI would play its role dragging down the pair. Perhaps, this scenario might occur over a failure in breaking the 1.3133 resistance.