USD/CAD Daily Forecast – Test Of Resistance At 1.2790

Canadian Dollar Continues To Lose Ground Against U.S. Dollar

USD/CAD is currently trying to settle above the resistance level at 1.2790 while the U.S. dollar is moving higher against a broad basket of currencies.

The U.S. Dollar Index is stuck near the yearly highs at 93.40. RSI for the U.S. Dollar Index remains in the moderate territory, and there is enough room to develop additional upside momentum in case the right catalysts emerge. A successful test of the resistance at 93.40 will open the way to the test of the next resistance at 93.65 which will be bullish for USD/CAD.

Today, U.S. reported that Initial Jobless Claims declined from 377,000 (revised from 375,000) to 348,000 while Continuing Jobless Claims decreased from 2.9 million (revised from 2.87 million) to 2.82 million. The reports provided additional support to U.S. dollar.

However, the main catalyst for USD/CAD today is the continuation of the sell-off in commodity markets. WTI oil is currently trying to settle below the $63 level. In case this attempt is successful, it will move closer to the support level at $62 which will be bearish for commodity-related currencies, including Canadian dollar.

Technical Analysis

USD to CAD has managed to settle above the resistance level at 1.2765 and is trying to settle above the next resistance level which is located at 1.2790. In case USD to CAD settles above this level, it will get to another test of the resistance at 1.2820.

A move above the resistance at 1.2820 will open the way to the test of the resistance at 1.2850. If USD to CAD gets above the resistance level at 1.2850, it will head towards the next resistance at 1.2875.

On the support side, the previous resistance level at 1.2765 will serve as the first support level for USD to CAD. It should be noted that RSI is in the overbought territory, so the risks of a pullback are increasing. In case USD to CAD gets back below 1.2765, it will head towards the next support level which is located at 1.2730.

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