USD/CAD Daily Forecast – Test Of Support At 1.2480

U.S. Dollar Is Losing Ground Against Canadian Dollar

USD/CAD is currently trying to settle below the support at 1.2480 while U.S. dollar is losing some ground against a broad basket of currencies.

The U.S. Dollar Index is currently located in the range between the support at 92.15 and the resistance at the 20 EMA at 92.30. In case the U.S. Dollar Index declines below the support at 92.15, it will move towards the next support at 92 which will be bearish for USD/CAD.

Today, U.S. reported that Initial Jobless Claims declined from 399,000 (revised from 400,000) to 385,000 compared to analyst consensus of 384,000. The report was in line with the analyst consensus and had no impact on currency dynamics on the foreign exchange market.

Meanwhile, WTI oil managed to find support near the $68 level and moved above the $69 level, providing support to commodity-related currencies, including Canadian dollar. In case WTI oil continues to rebound and gets to the test of the psychologically important $70 level, Canadian dollar may get more support.

Technical Analysis

USD to CAD managed to settle below the support level at 1.2500 and is testing the next support level at 1.2480. In case USD to CAD settles below this support level, it will head towards the next support which is located at the 50 EMA at 1.2450.

A successful test of the support at 1.2450 will push USD to CAD towards the next support which is located at the lows of the recent pullback at 1.2420. A move below this level will open the way to the test of the support at 1.2385.

On the upside, the previous support level at 1.2500 will serve as the first resistance level for USD to CAD. In case USD to CAD manages to get back above this level, it will move towards the next resistance at the 20 EMA at 1.2515. If USD to CAD settles above the 20 EMA, it will head towards the resistance at 1.2550.

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