USD/CAD Daily Forecast – Test Of Resistance At 1.2915

Canadian Dollar Remains Under Pressure

USD/CAD is currently trying to settle above the resistance at 1.2915 while the U.S. dollar is gaining some ground against a broad basket of currencies.

The U.S. Dollar Index managed to settle above the resistance at 96.50 and is trying to get to the test of the next resistance level at 96.70. A move above the resistance at 96.70 will open the way to the test of the resistance at 97 which will be bullish for USD/CAD.

Today, U.S. reported that Retail Sales increased by 0.3% month-over-month in November compared to analyst consensus which called for growth of 0.8%. On a year-over-year basis, Retail Sales grew by 18.2% compared to analyst forecast of 15.9%.

Foreign exchange market traders also had a chance to take a look at inflation data from Canada. Inflation Rate increased by 0.2% month-over-month in November, in line with the analyst consensus. On a year-over-year basis, Inflation Rate grew by 4.7%. Core Inflation Rate increased by 3.6% year-over-year.

The main event of the day for USD/CAD traders is the Fed Interest Rate Decision and the subsequent commentary. Trading will likely calm down a bit ahead of this event, but volatility will certainly increase after the Fed releases its statement.

Technical Analysis

USD to CAD managed to settle above 1.2890 and is testing the next resistance at 1.2915. In case this test is successful, USD to CAD will move towards the resistance level at 1.2940.

A move above 1.2940 will open the way to the test of the resistance at 1.2970. In case USD to CAD manages to settle above this level, it will head towards the next resistance level which is located at 1.3015.

On the support side, the previous resistance level at 1.2890 will serve as the first support level for USD to CAD. In case USD to CAD moves back below this level, it will head towards the support at 1.2850. A successful test of the support at 1.2850 will push USD to CAD towards the support at 1.2825.

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