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USD/CAD Daily Forecast – U.S. Dollar Remains Under Pressure Against Canadian Dollar

By:
Vladimir Zernov
Published: Feb 3, 2021, 17:42 UTC

USD/CAD managed to get below the 50 EMA and is trying to settle below the 20 EMA.

USD/CAD

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USD/CAD Video 03.02.21.

Canadian Dollar Continues To Move Higher Against U.S. Dollar

USD/CAD is currently trying to settle below the support at the 20 EMA at 1.2765 while the U.S. dollar is mostly flat against a broad basket of currencies.

The U.S. Dollar Index has settled above 91.10 but failed to get above the minor resistance level which has emerged near 91.30. If the U.S. Dollar Index gets above this level, it will get to the test of the resistance at 91.50 which will be bullish for USD/CAD.

Today, the U.S. released ADP Employment Change report which indicated that private businesses hired 174,000 workers in January compared to analyst consensus of 49,000.

Meanwhile, the U.S. Services PMI report showed that Services PMI increased from 54.8 in December to 58.3 in January compared to analyst consensus of 57.5. Both reports exceeded expectations and indicated that U.S. economy has started the year on a strong note.

At the same time, Canadian dollar got a boost from the continuation of the oil rally. WTI oil is currently trying to settle above the $56 level after the release of a bullish inventory report which indicated that crude inventories continued to decline. If oil moves higher, commodity-related currencies including Canadian dollar will get additional support.

Technical Analysis

usd cad february 3 2021

USD to CAD managed to get below the support at 1.2775 and is currently testing the support at the 20 EMA at 1.2765. If this test is successful, USD to CAD will get to the test of the next support level at 1.2750.

A successful test of the support at 1.2750 will open the way to the test of the next support level which is located at 1.2720.

On the upside, a move above 1.2775 will open the way to the test of the 50 EMA at 1.2800. USD to CAD has recently made an attempt to settle above the 50 EMA but this attempt yielded no results.

If USD to CAD manages to settle above the 50 EMA, it will head towards the resistance at 1.2835. A move above this level will open the way to the test of the resistance at 1.2860.

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

About the Author

Vladimir is an independent trader and analyst with over 10 years of experience in the financial markets. He is a specialist in stocks, futures, Forex, indices, and commodities areas using long-term positional trading and swing trading.

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