USD/CAD Forecast – US Dollar Eyeing Gains Above 1.2950 Vs Canadian Dollar

USD/CAD Forecast – US Dollar Eyeing Gains Above 1.2950 Vs Canadian Dollar

  • – The US Dollar formed a decent support at 1.2880 and moved higher against the Canadian Dollar.
  • – There was a break above a major bearish trend line with resistance at 1.2928 on the hourly chart of USD/CAD.
  • – Recently in Canada, the Consumer Price Index (CPI) for August 2018 was released by the Statistics Canada.
  • – The outcome was around the forecast as there was a rise in the CPI by 2.8% (YoY).

 

Canada’s Consumer Price Index (CPI)

Recently in Canada, the Consumer Price Index (CPI) for August 2018 released by the Statistics Canada. The market was positioned for an increase of around 2.8% in the CPI in June 2018 compared with the same month a year ago.

 

However, the actual result was around the forecast as there was a rise in the CPI by 2.8% (YoY). Looking at the Core CPI, there was a rise of 1.7% (YoY), compared with the last reading of 1.6% and more than the forecast of 1.4%.

 

The USD/CAD pair is currently trading with a positive angle and it seems like it could rise towards the 1.2950 and 1.2975 levels in the near term.

 

USD/CAD Technical Analysis

The US dollar found bids near the 1.2880 level after a strong decline against the Canadian Dollar. The USD/CAD pair traded as low as 1.2885, started an upward move, broke the 1.2900 resistance, and moved into a positive zone.

 

USD/CAD Technical Analysis US Dollar Canadian Dollar

 

During the rise, there was a break above a major bearish trend line with resistance at 1.2928 on the hourly chart of USD/CAD. At the moment, the pair is testing the 23.6% fib retracement level of the last decline from the 1.3064 high to 1.2885 low.

 

If there is a break above the 1.2935 level, the pair could rise towards the 1.2950 level. Above this, buyers may push the pair towards the 50% fib retracement level of the last decline from the 1.3064 high to 1.2885 low at 1.2975.

 

On the flip side, if the pair dips from the current levels, the 1.2900 and 1.2885 levels may act as supports. Below 1.2885, the pair will most likely drop towards the 1.2850 level in the near term.


Also published on Medium.

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