USD/CAD Daily Forecast – Test Of Support At 1.2340
U.S. Dollar Remains Under Pressure Against Canadian Dollar
USD/CAD has recently made an attempt to settle below the support at 1.2340 while the U.S. dollar remained under pressure against a broad basket of currencies.
The U.S. Dollar Index declined below the support at 93.75 and made an attempt to settle below 93.50, but lost momentum and moved back to 93.75. In case the U.S. Dollar Index manages to settle back above this level, it will head towards the resistance at the 94 level which will be bullish for USD/CAD.
Today, foreign exchange market traders had a chance to take a look at Building Permits and Housing Starts reports from U.S. Building Permits declined by 7.7% month-over-month in September while Housing Starts decreased by 1.6%. Both reports missed analyst estimates.
Traders also monitored the developments in commodity markets as WTI oil managed to get back above the $83 level and moved closer to multi-year highs near the $84 level. In case WTI oil manages to settle above this level, it will gain additional upside momentum and head towards the psychologically important $85 level which will be bullish for commodity-related currencies, including Canadian dollar.
USD to CAD tried to settle below the support at 1.2340 but failed to develop sufficient downside momentum. In case USD to CAD manages to settle below this level, it will head towards the next support at 1.2320.
A successful test of the support at 1.2320 will push USD to CAD towards the next support level at 1.2300. In case USD to CAD declines below the support at 1.2300, it will move towards the support at 1.2270.
On the upside, the nearest resistance level for USD to CAD is located at 1.2380. If USD to CAD manages to settle above 1.2380, it will head towards the next resistance level at 1.2400. A successful test of this level will open the way to the test of the resistance at 1.2425.
For a look at all of today’s economic events, check out our economic calendar.