USD/CAD Daily Forecast – U.S. Dollar Is Mostly Flat Against Canadian Dollar
Canadian Dollar Tries To Gain More Ground Against U.S. Dollar
USD/CAD is currently trying to settle below the support at 1.2590 while the U.S. dollar is flat against a broad basket of currencies.
The U.S. Dollar Index remains stuck between 90.60 and the resistance at the 20 EMA at 92.80. In case the U.S. Dollar Index declines below 90.60, it will head towards the support level at the 50 EMA at 92.45 which will be bearish for USD/CAD.
Today, U.S. reported that Pending Home Sales declined by 1.8% month-over-month compared to analyst consensus which called for growth of 0.4%. The report had minimal impact on currency dynamics as foreign exchange market traders remained focused on Fed’s dovish rhetoric.
The yield of 10-year Treasuries continued to move lower and managed to settle below 1.30%, which was bearish for the U.S. dollar. Meanwhile, WTI oil gained some ground, providing support to commodity-related currencies, including Canadian dollar.
USD to CAD made an attempt to settle below the nearest support level at 1.2590 but failed to develop sufficient downside momentum. As a result, USD to CAD continued to trade in the range between the support at 1.2590 and the resistance at the 20 EMA near 1.2625.
In case USD to CAD manages to settle below the support at 1.2590, it will head towards the next material support level which is located at the 50 EMA at 1.2550. RSI remains in the moderate territory, and there is plenty of room to gain additional downside momentum in case the right catalysts emerge.
If USD to CAD settles below the 50 EMA, it will move towards the support at 1.2530. A successful test of this level will open the way to the test of the next support at 1.2500.
On the upside, a move above 1.2625 will push USD to CAD towards the resistance at 1.2650. In case USD to CAD manages to settle above this level, it will head towards the resistance at 1.2685. A move above 1.2685 will open the way to the test of the resistance at 1.2710.
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