USD/CAD Exchange Rate Prediction – The Dollar Slips Toward Support
On Wednesday, the dollar eased, settling next to trend line support. The U.S. yield curve steepened after flattening for most of the month. Stronger than anticipated housing prices lifted the 10-year yield which weighed on the greenback.
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Technical Analysis
The USD/CAD moved lower on Wednesday, slipping to support. Support is seen near an upward sloping trend line that comes in near 1.2780. Resistance on the USD/Cad is seen near the 10-day moving average at 1.2840. Short-term momentum has turned negative as the fast stochastic generated a crossover sell signal. Medium-term momentum has turned negative as the MACD (moving average convergence divergence) index generated a crossover sell signal. This scenario occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses above the MACD signal line (the 9-day moving average of the MACD line). The MACD histogram is printing in negative territory with a downward sloping trajectory which points a lower exchange rate.
According to S&P, U.S. home prices surged in October as the housing market continued to boom. The 20-city home price index climbed 18.4% in October year over year. The gain marked a slight deceleration from a 19.1% year-over-year increase in September but aligned with expectations.