USD/CAD Daily Forecast – U.S. Dollar Retreats As Consumer Sentiment Declines

Canadian Dollar Gains Some Ground Against U.S. Dollar

USD/CAD is currently trying to settle back below the support at 1.2550 while the U.S. dollar is losing some ground against a broad basket of currencies.

The U.S Dollar Index is stuck in the range between the support at 95 and the resistance at 95.20. In case the U.S. Dollar Index declines below the support at 95, it will move towards the next support level at 94.75 which will be bearish for USD/CAD.

Today, foreign exchange market traders had a chance to take a look at Michigan Consumer Sentiment report from U.S. The report indicated that Consumer Sentiment declined from 71.7 in October to 66.8 in November while analysts expected that it would grow to 72.4.

The U.S. dollar found itself under some pressure against a broad basket of currencies after the release of this report. The report shows that high prices have become a problem for consumers. In case inflation remains at high levels while Consumer Sentiment stays under pressure in the upcoming months, the Fed may have to raise rates sooner than expected.

Technical Analysis

USD to CAD failed to settle above the resistance at 1.2590 and declined towards the support level at 1.2550.

In case USD to CAD manages to settle below the support at 1.2550, it will head towards the next support level which is located at 1.2530. A move below this level will open the way to the test of the support at 1.2500.

On the upside, USD to CAD needs to stay above 1.2550 to have a chance to develop upside momentum in the near term. The next resistance level for USD to CAD is located at 1.2590.

If USD to CAD gets above 1.2590, it will head towards the resistance at 1.2625. A successful test of this level will push USD to CAD towards the resistance at 1.2650. In case USD to CAD manages to settle above 1.2650, it will head towards the resistance at 1.2675.

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