USD/CAD Daily Forecast – Support At 1.2930 Remains Strong

USD/CAD Video 30.11.20.

Suddenly, U.S. Dollar Gained Upside Momentum

USD/CAD made an attempt to settle below the support at 1.2930 but lost downside momentum and is trying to settle above the resistance at 1.2985 as the U.S. dollar reversed course against a broad basket of currencies.

Earlier, the U.S. Dollar Index managed to get below the support at 91.75 and tried to develop additional downside momentum. However, the U.S. Dollar index received strong support at 91.50 and returned back above 91.75. The nearest resistance level for the U.S. Dollar Index is located at 92.10. If the U.S. Dollar Index moves towards this level,  USD/CAD will get more support.

Today, U.S. reported that Pending Home Sales decreased by 1.1% month-over-month in October after falling by 2% in September. Analysts expected that Pending Home Sales would increase by 1%.

Meanwhile, Canada’s Building Permits decreased by 14.6% month-over-month in October while analysts forecasted that they would decline by 5%.

The above-mentioned economic reports indicated that the second wave of the virus has started to put some pressure on the housing market in both U.S. and Canada.

Technical Analysis

USD to CAD made a serious attempt to settle below the support at November lows at 1.2930. However, the U.S. dollar has suddenly gained support on the foreign exchange market, and USD to CAD returned to the nearest resistance level at 1.2985.

If USD to CAD manages to settle above this level, it will get to the test of the next resistance at 1.3000. A move above 1.3000 will push USD to CAD towards the resistance at 1.3025. In case USD to CAD moves above the resistance at 1.3025, it will head towards the next resistance level near the 20 EMA at 1.3050.

On the support side, the nearest support level for USD to CAD is located at 1.2930. I’d note that no material levels were formed between 1.2930 and 1.2985 so USD to CAD may quickly get to another test of this level in case the right catalysts emerge.

If USD to CAD settles below the support at 1.2930, it will decline towards the next support level at 1.2900.

For a look at all of today’s economic events, check out our economic calendar.