USD/CAD Daily Forecast – Test Of Support At 1.2310

USD/CAD Video 29.04.21.

U.S. Dollar Remains Under Pressure Against Canadian Dollar After Yesterday’s Sell-Off

USD/CAD is currently trying to settle below the support at 1.2310 while the U.S. dollar is gaining ground against a broad basket of currencies.

The U.S. Dollar Index failed to settle below the support at 90.50 and rebounded towards the resistance at 90.70. Currently, the U.S. Dollar Index is trying to settle above this level. In case this attempt is successful, the U.S. Dollar Index will move towards the next resistance at the 91 level which will be bullish for USD/CAD.

Today, the U.S. reported that Initial Jobless Claims declined from 566,000 (revised from 547,000) to 553,000 compared to analyst consensus of 549,000. Continuing Jobless Claims increased from 3.65 million (revised from 3.67 million) to 3.66 million compared to analyst consensus of 3.61 million. The reports supported Fed’s view that job market remained far from full recovery.

Foreign exchange market traders also had a chance to take a look at GDP Growth Rate report which showed that GDP grew by 6.4% quarter-over-quarter in the first quarter compared to analyst consensus of 6.1%.

The U.S. economy rebounds at a robust pace, and some traders and analysts are already worried that the fast pace of this rebound will lead to high inflation. The Fed does not look worried about inflation, but Treasury yields have been moving higher in recent trading sessions, which can provide more support to the American currency.

Technical Analysis

USD to CAD remains under pressure and is trying to settle below the support at 1.2310. In case this attempt is successful, it will move towards the next support level at 1.2280.

A successful test of the support at 1.2280 will open the way to the test of the next support at 1.2250. If USD to CAD declines below 1.2250, it will move towards the support level which is located at 1.2220.

On the upside, a move above 1.2310 will open the way to the test of the resistance at 1.2350. If USD to CAD manages to settle above this level, it will head towards the next resistance at 1.2365. A move above this level will push USD to CAD towards the resistance at 1.2385.

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