USD/CAD Daily Forecast – Test Of Resistance At 1.2350

U.S. Dollar Gains Ground Against Canadian Dollar

USD/CAD is currently trying to settle above the resistance at 1.2350 while the U.S. dollar is flat against a broad basket of currencies.

The U.S. Dollar Index is currently stuck in the range between the support at 91.80 and the resistance at 92. In case the U.S. Dollar Index manages to settle below the support level at 91.80, it will gain downside momentum and move towards the recent lows near 91.50 which will be bearish for USD/CAD.

There are no important economic reports scheduled to be released in the U.S. and Canada today so foreign exchange market traders will stay focused on general market sentiment.

It remains to be seen whether traders are ready for any big moves before U.S. starts to release its employment data on Wednesday when traders will have a chance to take a look at ADP Employment Change report for June. This report will be followed by Initial Jobless Claims report on Thursday and Non Farm Payrolls report on Friday.

Traders will also keep an eye on the developments in commodity markets. Today, WTI oil faced resistance near $74.50 and pulled back towards the $73 level which was bearish for commodity-related currencies including Canadian dollar.

Technical Analysis

USD to CAD managed to get above the resistance at 1.2325 and made an attempt to get above the next resistance level at 1.2350.

In case USD to CAD manages to settle above 1.2350, it will move towards the next resistance level at 1.2385. A successful test of this level will open the way to the test of the resistance which is located at 1.2420.

On the support side, the previous resistance at 1.2325 will serve as the first support level for USD to CAD. In case USD to CAD declines below this level, it will move towards the next support at 1.2300.

A move below the support at 1.2300 will push USD to CAD towards the support which is located near the 20 EMA at 1.2270. In case USD to CAD declines below the 20 EMA, it will move towards the 50 EMA at 1.2250.

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