USD/CAD Daily Forecast – Test Of Support At 1.2590

USD/CAD Video 19.02.21.

Canadian Dollar Is Gaining Ground Ahead Of The Weekend

USD/CAD managed to settle below the support level at 1.2625 and is trying to settle below the next support at 1.2590 while the U.S. dollar is losing ground against a broad basket of currencies.

The U.S. Dollar Index managed to settle below the nearest support level at 90.30 and is trying to gain additional downside momentum. If this attempt is successful, it will head towards the next support at the 90 level which will be bearish for USD/CAD.

Today, U.S. reported that Manufacturing PMI declined from 59.2 in January to 58.5 in February, in line with the analyst consensus. Services PMI increased from 58.3 to 58.9 compared to analyst consensus of 57.6. Existing Home Sales increased by 0.6% month-over-month in January compared while analysts expected that they would decline by 1.5%. The economic data from U.S. exceeded expectations but did not provide support to the American currency as traders preferred riskier assets.

Meanwhile, Canada reported that Retail Sales declined by 3.4% month-over-month in December compared to analyst consensus which called for a decline of 2.5%. On a year-over-year basis, Retail Sales grew by 3.3%.

Technical Analysis

USD to CAD is currently trying to get below the support level at the yearly lows at 1.2590. If this attempt is successful, USD to CAD will head towards the next support level which is located at 1.2550.

RSI is in the moderate terrritory, and there is plenty of room to gain additional downside momentum. In case USD to CAD declines below the support at 1.2550, it will head towards the next support level at 1.2525.

On the upside, the previous support level at 1.2625 will serve as the first resistance level for USD to CAD. If USD to CAD gets above this level, it will head towards the next resistance at 1.2665. A move above this level will open the way to the test of the resistance at 1.2700.

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