The US dollar rises against the Canadian dollar
The USD / CAD continues its attempts to settle above the nearest resistance level at 1.2800 as the US Dollar gains ground against a large basket of currencies.
Currently, the US dollar index is trying to move above resistance at the 91 level. The US dollar index has already made several attempts to break above this level, but failed to gain enough upward momentum. If the US dollar index moves above 91, it will head towards 91.50 which will be bullish for the USD / CAD.
No major economic reports have been released in the United States and Canada today, so forex market traders have focused on general market news. Britain has started mass vaccination of its citizens, but this news has failed to support riskier assets. Perhaps the lingering problems in the Brexit negotiations have reduced traders’ risk appetite.
Tomorrow, the Bank of Canada will announce its decision on interest rates. The interest rate is expected to remain unchanged at 0.25%, so traders will focus on the Bank’s comments. At this point, no major movement is expected, but the Bank could share its views on other ways to support the economy.
The USD to CAD has failed to settle below support at 1.2775 and is trying to gain some bullish momentum above the nearest resistance level at 1.2800. If this attempt is successful, the USD in CAD will hit the test of the next resistance at 1.2835.
A move above resistance at 1.2835 will push USD to CAD towards resistance at 1.2860. In the event that the USD to CAD manages to settle above the resistance at 1.2860, it will head to the next resistance level at 1.2900.
At this point, the resistance levels between 1.2800 and 1.2900 don’t look very strong, so the USD to CAD may have a good chance of developing bullish momentum in case the right catalysts emerge.
On the support side, the USD to CAD needs to move below recent lows at 1.2775 to continue its bearish movement. In the event that the USD to CAD moves below the support at 1.2775, it will gain momentum on the downside and quickly reach the test of the support at 1.2750.
For an overview of all of today’s economic events, check out our economic calendar.