USD/CAD Daily Forecast – Resistance At 1.3120 Stays Strong
USD/CAD Video 19.11.20.
U.S. Dollar Tries To Gain Ground Against Canadian Dollar
USD/CAD has recently made an attempt to settle above the resistance at 1.3100 as the U.S. dollar rebounded against a broad basket of currencies.
The U.S. dollar is gaining ground against a basket of currencies on the foreign exchange market for the first session out of the last six trading days. The U.S. Dollar Index has managed to get above the resistance at 92.50 and even tried to get to the test of the next resistance level at 92.80 but failed to gain additional momentum and declined back to 92.50.
If the U.S. Dollar Index settles below 92.50, it may gain downside momentum and move towards the next support level at 92.10 which will be bearish for USD/CAD.
Today, the U.S. reported that Initial Jobless Claims increased from 711,000 (revised from 709,000) to 742,000 while Continuing Jobless Claims declined from 6.8 million (revised from 6.79 million) to 6.37 million.
The U.S. job market is showing first signs of additonal weakness as the second wave of the virus starts to put pressure on the economy. However, traders will have to wait for the next reports to see whether Initial Jobless Claims will continue to increase.
Meanwhile, the U.S. housing market remains in a good shape as Existing Home Sales increased by 4.3% month-over-month in October compared to analyst consensus which called for a decline of 1.2%.
In Canada, ADP Employment Change report indicated that private business employment decreased by 79,500 in October. ADP Employment Change remains in the negative territory since March.
USD to CAD has recently tested the resistance at the 20 EMA at 1.3120 but failed to gain sufficient upside momentum and declined below 1.3100. The nearest support level for USD to CAD is located at 1.3080.
If USD to CAD settles below this level, it will head towards the next support at 1.3050. A successful test of this support level will push USD to CAD towards the next support at 1.3000.
On the upside, USD to CAD needs to settle above 1.3100 to have a chance to get to another test of the resistance at 1.3120. If USD to CAD manages to settle above this level, it will gain upside momentum and head towards the resistance at the 50 EMA at 1.3170.
For a look at all of today’s economic events, check out our economic calendar.