USD/CAD Daily Forecast – Resistance At 1.3135 Remains A Serious Obstacle On The Way Up
USD/CAD Video 14.10.20.
Canadian Dollar Is Mostly Flat Against U.S. Dollar
USD/CAD continues its attempts to settle above the nearest resistance level at 1.3135 while the U.S. dollar is losing ground against a broad basket of currencies.
Your capital is at risk
The U.S. Dollar Index has lost upside momentum and declined below the 20 EMA at 93.50. If the U.S. Dollar Index settles below 93.50, it will likely gain downside momentum which will be bearish for USD/CAD.
Meanwhile, WTI oil is trying to settle above the nearest resistance level at $40.70. Interestingly, a combination of weaker U.S. dollar and stronger oil did not manage to put pressure on USD/CAD.
Tomorrow, USD/CAD traders will focus on employment data from U.S. and Canada. U.S. Initial Jobless Claims are expected to decline from 840,000 to 825,000 while Continuing Jobless Claims are projected to fall from 10.98 million to 10.7 million.
In Canada, ADP Employment Change report is expected to show that private businesses cut about 50,000 jobs in September.
Another important topic for USD/CAD traders is the continued uncertainty about the fate of the new U.S. coronavirus aid package. Recent reports indicate that U.S. House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin had a good discussion on the aid deal, but it remains to be seen whether Democrats and Republicans will be able to reach consensus before the election in November.
Technical Analysis
USD to CAD is currently testing the nearest resistance level at 1.3135. If USD to CAD manages to settle above 1.3135, it will gain additional upside momentum and head towards the major resistance level at 1.3200.
A move above 1.3200 will open the way to the 20 EMA level at 1.3215. A move above the 20 EMA will signal that USD to CAD is gaining strength. In this case, USD to CAD will head towards the next resistance level at the 50 EMA at 1.3250.
On the support side, the nearest support level is still located at the recent lows at 1.3100. If USD to CAD declines below this support level, it will continue its downside move and get to the test of the next support at 1.3050.
For a look at all of today’s economic events, check out our economic calendar.