USD/CAD Daily Forecast – Test Of Resistance At 1.2725USD/CAD settled above the resistance at 1.2700 and is trying to settle above the next resistance level at 1.2725.
USD/CAD Video 17.02.21.
U.S. Dollar Continues To Gain Ground Against Canadian Dollar
USD/CAD is currently trying to settle above the resistance at the 20 EMA at 1.2725 while the U.S. dollar is moving higher against a broad basket of currencies.
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The U.S. Dollar Index managed to get above the resistance at 90.90 and is trying to get to the test of the next resistance level which is located at 91.10. If the U.S. Dollar Index gets above the resistance at 91.10, it will head towards the next resistance at 91.30 which will be bullish for USD/CAD.
Today, the U.S. reported that Retail Sales increased by 5.3% month-over-month in January compared to analyst consensus of 1.1%. Strong growth of U.S. Retail Sales provided material support to the American currency on the foreign exchange market.
The U.S. has also reported that Industrial Production grew by 0.9% month-over-month in January while Manufacturing Production increased by 1.0%. Both reports exceeded analyst expectations and painted a picture of a robust economic rebound.
Meanwhile, Canada released inflation data for January. Inflation Rate grew by 0.6% month-over-month compared to analyst consensus which called for growth of 0.4%. On a year-over-year basis, Inflation Rate increased by 1% while Core Inflation Rate grew by 1.6%.
USD to CAD is currently testing the nearest resistance level at the 20 EMA at 1.2725. If this test is successful, USD to CAD will head towards the next resistance at 1.2750.
In case USD to CAD settles above the resistance at 1.2750, it will move towards the 50 EMA at 1.2770. a move above the 50 EMA will open the way to the test of the next resistance level which is located at 1.2800.
On the support side, the nearest support level for USD to CAD is located at 1.2700. This support level has already been tested during the current trading session and proved its strength. If USD to CAD declines below this support level, it will move towards the next support at 1.2665. A successful test of the support at 1.2665 will push USD to CAD towards the next support at 1.2625.
For a look at all of today’s economic events, check out our economic calendar.