USD/CAD Daily Forecast – Support At 1.3000 In SightUSD/CAD settled below the support at 1.3050 and is trying to get to the test of the next support at 1.3000.
USD/CAD Video 24.11.20.
Strong Oil Provides Support To Canadian Dollar
USD/CAD managed to get below the support at 1.3050 and is moving towards the next support level at 1.3000 while the U.S. dollar is losing ground against a broad basket of currencies.
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The U.S. Dollar Index failed to settle above the resistance at 92.50 and is once again trying to get to the test of the major support level at 92.10. A successful test of this level will open the way to the next support at 91.75 which will be bearish for USD/CAD.
Today, the U.S. dollar is under pressure as traders believe that Joe Biden’s pick for Treasury Secretary, the former Fed Chair Janet Yellen, will implement a very dovish policy.
The market expects that Yellen will keep rates at the bottom as long as possible to support economic recovery which will be bearish for the U.S. dollar.
At this same time, it remains to be seen whether American currency is ready to lose more ground on the foreign exchange market since the support for the U.S. Dollar Index remains strong near current levels.
Meanwhile, Canadian dollar and other commodity-related currencies are supported by oil’s rally. Oil managed to get above the resistance at August highs at $43.75 and made an attempt to settle above the $45 level. If oil continues its upside move, Canadian dollar may get additional support.
USD to CAD is currently trying to get to the test of the nearest support level at 1.3000. RSI is still in the moderate territory so there is plenty of room to gain additional downside momentum in case the right catalysts emerge.
In case USD to CAD settles below this level, it will head towards the next support at 1.2985. A move below the support at 1.2985 will push USD to CAD towards the next support level at November lows at 1.2930.
On the upside, the previous support at 1.3050 will likely serve as the first resistance level for USD to CAD. If USD to CAD gets above this level, it will head towards the resistance at 1.3080. A move above 1.3080 will open the way to the test of the next resistance at the 20 EMA at 1.3100.
For a look at all of today’s economic events, check out our economic calendar.