USD/CAD Daily Forecast – Test Of Support At 1.3280

USD/CAD Video 01.10.20.

Canadian Dollar Tries To Gain More Ground Against The U.S. Dollar Despite Weak Oil

USD/CAD made an attempt to settle below the 50 EMA at 1.3280 but falling oil prices put some pressure on the Canadian dollar although it is still gaining ground against the U.S. dollar.

The U.S. Dollar Index, which measures the strength of the U.S. dollar against a broad basket of currencies, has recently made an attempt to settle above the nearest resistance level at the 50 EMA at 93.90 but did not manage to gain sufficient upside momentum.

If the U.S. Dollar Index returns back above the 50 EMA, USD/CAD may get additional support.

Today, the U.S. reported that Initial Jobless Claims declined to 837,000 while Continuing Jobless Claims decreased to 11.77 million. Both reports were better than analyst expectations and pointed to continued improvements in the U.S. job market.

At this point, it looks like traders are undecided whether they should buy the U.S. dollar because the recent employment reports were above expectations or sell the U.S. dollar in order to buy riskier assets since the economic situation is improving.

Perhaps, the market will wait for U.S. Non Farm Payrolls and Unemployment Rate reports which are due to be published on Friday. The Non Farm Payrolls report is expected to show that the economy added 850,000 jobs while Unemployment Rate is projected to decrease from 8.4% in August to 8.2% in September.

Technical Analysis

 

USD to CAD tried to get below the 50 EMA at 1.3280 but rebounded closer to 1.3300. If USD to CAD manages to settle below the 50 EMA and the 20 EMA, it will gain more downside momentum and head towards the next support level at 1.3235.

If USD to CAD gets below the support at 1.3235, it will head towards the next support at 1.3200.

On the upside, the previous support level at 1.3330 will likely serve as the first resistance level for USD to CAD. A move above this resistance level will open the way to the test of the major resistance level at 1.3420. If USD to CAD gets above 1.3420, it will continue its upside move and get to the next resistance at 1.3450.

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