Talking Points:
- USD/CAD Rises Ahead of FOMC
- Current 10 Day EMA Support Found at 1.3438
- Looking for additional trade ideas for US Dollar pairs? Read our 2017 Market Forecast
The USD/CAD is trading higher this morning as the US Dollar strengthens ahead of tomorrow’s FOMC rate decision. Expectations are set to see key rates to rise to 0.75%, and traders will also be looking to Fed Chair Janet Yellen’s conference to provide further direction for US Dollar based pairs.
Technically, the USD/CAD is currently trading below the standing 2017 high at 1.3535. Despite the markets retracement, the pair remains supported in a short term uptrend by its 10 day EMA (exponential moving average), which is found at 1.3438. In the event that tomorrows event is US Dollar bullish, traders will look for the USD/CAD to bounce and trade back towards yearly highs. Alternatively, in the event of a selloff, the pair will first need to breach the 10 day EMA before trading towards new lower lows.
USD/CAD Daily Chart with Averages
Intraday analysis find the USD/CAD trading above today’s central pivot at 1.3453. This bullish short term momentum has successfully lifted the pair above today’s first pivot found at 1.3475. If prices continue to rise, the next key values of intraday resistance include the R2 pivot (1.3499) and R3 pivot (1.3521). It should be noted that if the USD/CAD trades to the R3 pivot the pair would trading to a new weekly high, but still below the 2017 peak previously mentioned.
In the event of a bearish reversal, traders will first look for the pair to decline back through today’s central pivot. This shift in market momentum may see the USD/CAD continue to trade lower towards points of intraday support. For today’s session, this includes the S1 pivot (1.3429) and the S2 pivot (1.3406). A move to either of these areas should be seen as significant, as it would have the USD/CAD trading back below the previously mentioned 10 day EMA ahead of tomorrow’s news event.
USD/CAD 30 Minute Chart with Pivots
--- Written by Walker, Analyst for DailyFX.com
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