USD / CAD Video 12.21.20.
Canadian dollar tries to rebound
The USD / CAD is currently trying to move below support at 1.2860 after testing resistance at the EMA 50 at 1.2955 as the US dollar gains ground against a large basket of currencies.
The US dollar index was boosted amid concerns over the new strain of coronavirus. However, the resistance level test at 91 was unsuccessful and the US dollar index fell back to 90.30.
Most likely, the US currency has failed to continue its bullish movement in the forex market as US lawmakers have finally succeeded in reaching consensus on the new $ 900 billion coronavirus aid package. If the US dollar index moves towards the 90 level, the USD / CAD will come under pressure.
Today, Canada reported that wholesale sales increased 1% month over month in November. Meanwhile, the new housing price index rose 0.6% month over month in November. Year over year, the new housing price index increased 4.6%.
It should be noted that economic reports may have a limited impact on the mood of traders in future trading sessions, as market participants will likely continue to focus on major developments, including Brexit, the new stimulus package. and the new strain of COVID-19.
Technical analysis
The USD versus the CAD gained momentum higher, but faced resistance at the EMA 50 at 1.2955 and pulled back. Currently USD to CAD is moving towards support at 20 EMA at 1.2830.
If USD to CAD manages to settle below the support at 1.2830, it will move to the next support level at 1.2800. A break below 1.2800 will pave the way for testing support at 1.2775.
On the upside, the closest resistance level between USD and CAD is at 1.2860. If the USD to CAD moves above the resistance at 1.2860, it will head to the next resistance level at 1.2900. A successful test of resistance at 1.2900 will push USD to CAD towards the next resistance level at 50 EMA at 1.2955.
For an overview of all of today’s economic events, check out our economic calendar.
This article originally appeared on FX Empire
