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USD/CAD Video 24.09.20.


Canadian Dollar Remains Under Significant Pressure

USD/CAD is trying to settle above the resistance at 1.3400 as the U.S. dollar continues to gain ground against a broad basket of currencies.

The U.S. Dollar Index is trying to settle above 94.50. If this attempt is successful, the U.S. Dollar Index will get to the test of the significant resistance level at 94.65. A move above this level will push the U.S. Dollar Index towards 95.00 which will be bullish for USD/CAD.

Today, the U.S. reported that Initial Jobless Claims increased to 870,000, suggesting that the progress on the job front has stalled. Continuing Jobless Claims declined to 12.58 million.

At this point, it looks like traders are ready to buy the U.S. dollar on any bad news so the disappointing U.S. employment reports did not put any pressure on the American currency.

Meanwhile, the continued strength of WTI oil fails to provide any support to the Canadian dollar as traders are too focused on the potential second wave of the virus and the slowdown of the world economy.

Technical Analysis

USD to CAD gained strong upside momentum and is currently trying to settle above the nearest resistance level at 1.3400. Despite the strength of the recent upside move, RSI has not entered into the overbought territory, and there is still plenty of room to gain additional upside momentum.

If USD to CAD manages to settle above 1.3400, it will head towards the next resistance level at 1.3450. This level has been tested at the end of July and proved its strength.

In case USD to CAD moves above the resistance at 1.3450, it will head towards the major resistance level at 1.3500.

On the support side, the nearest support for USD to CAD is located at 1.3330. A move below this level will open the way to the test of the next support level at 1.3290.

If USD to CAD gets below the support at 1.3290, it will likely gain additional downside momentum and head towards the test of the resistance at the 50 EMA at 1.3260.

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

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