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USD/CAD Daily Forecast – Test Of Resistance At 1.2540

By:
Vladimir Zernov
Published: Jul 13, 2021, 16:23 UTC

USD/CAD tested resistance at 1.2540 but lost momentum and declined towards 1.2500.

USD/CAD Daily Forecast – Test Of Resistance At 1.2540

In this article:

Canadian Dollar Is Losing Ground Against U.S. Dollar

USD/CAD is currently trying to settle above the resistance at 1.2500 while the U.S. dollar is gaining ground against a broad basket of currencies.

The U.S. Dollar Index has managed to settle above the resistance at 92.40 and made an attempt to get to the test of the next resistance level at 92.80. In case the U.S. Dollar Index gets to the test of the resistance at 92.80, USD/CAD will get more support.

Today, foreign exchange market traders focused on inflation data from U.S. Inflation Rate increased by 5.4% year-over-year in June compared to analyst consensus which called for growth of 4.9%. Meanwhile, Core Inflation Rate grew by 4.5% compared to analyst consensus of 4%.

Inflation data provided material support to American currency as higher inflation should force Fed to raise rates sooner than previously expected.

However, I’d note that U.S. dollar dynamics will also depend on the commentary from Fed officials which will certainly come in the upcoming days. If Fed members insist that inflation is temporary and current levels are not a problem, U.S. dollar may find itself under some pressure.

Technical Analysis

usd cad july 13 2021

USD to CAD faced resistance at 1.2540 and pulled back towards 1.2500. Currently, USD to CAD is trying to stay above this level.

In case this attempt is successful, USD to CAD will move towards the next resistance which is located at 1.2520. A successful test of this level will push USD to CAD back towards the resistance at 1.2540. If USD to CAD gets above this level, it will move towards the resistance at 1.2560.

On the support side, a move below 1.2500 will open the way to the test of the support at 1.2480. If USD to CAD declines below this level, it will move towards the support at 1.2450. In case USD to CAD manages to settle below the support at 1.2450, it will head towards the next support level at 1.2420.

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

About the Author

Vladimir is an independent trader and analyst with over 10 years of experience in the financial markets. He is a specialist in stocks, futures, Forex, indices, and commodities areas using long-term positional trading and swing trading.

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