Dollar/CAD ended the week on higher ground, after being rocked by contradicting Canadian figures. The upcoming week features the all-important GDP numbers. Will the pair continue higher? Here are the highlights and an updated technical analysis for USD/CAD.
Canadian retail sales plunged by 0.8% in December, much worse than expected, and this sent the pair higher. However, inflation is also rising, with 1.7% y/y in January and this sent the pair lower. In the US, the meeting minutes came out slightly more hawkish than predicted, supporting the greenback, but it wasn’t a straight line higher.
USD/CAD daily graph with support and resistance lines on it. Click to enlarge:
All times are GMT
USD/CAD Technical Analysis
Dollar/CAD made a move to the upside but eventually found support at 1.26, mentioned last week.
Technical lines from top to bottom:
1.30 is a round number that is eyed by many. 1.2920 was a triple top in late 2017 and continues serving as resistance.
1.2790 was the high in mid-November and serves as resistance. 1.2665 was a was a double-bottom in November and works as strong support.
It is followed by 1.26, a round number that worked as resistance in October. 1.2540 capped the pair in early October when it traded in a narrow range.
1.25 remains a battleground. 1.2450 served as support in February. 1.2335 gave support to the pair in late September and it worked well in January 2018.
Even lower, 1.2250 cushioned the pair on its fall in February 2018. It is closely followed by 1.22
Strong support only awaits at 1.2070. The round number of 1.20 is next. And below there, only 1.18.
I remain bullish on USD/CAD
The Canadian dollar remains vulenrable to the not-so-great economy. The BOC remains hesitant and the US dollar may tick up a bit more.
Our latest podcast is titled Volatility is back with a vengeance and the perky pound
Follow us on Sticher or iTunes
- EUR/USD forecast – for everything related to the euro.
- GBP/USD forecast – Pound/dollar predictions
- USD/JPY forecast – analysis for dollar/yen
- AUD/USD forecast – projections for the Aussie dollar.
- Forex weekly forecast – Outlook for the major events of the week.