News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
EUR/USD
Bullish
Oil - US Crude
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Wall Street
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Gold
Mixed
GBP/USD
Bullish
USD/JPY
Mixed
More View more
Real Time News
  • Trading bias allows traders to make informative decisions when dealing in the market. This relates to both novice and experienced traders alike. Start learning how you may be able to make more informed decisions here: https://t.co/rz7fqhRoMG https://t.co/e4G1gTGhex
  • Greed is a natural human emotion that affects individuals to varying degrees. Unfortunately, when viewed in the context of trading, greed has proven to be a hindrance more often than it has assisted traders. Learn how to control greed in trading here: https://t.co/kODPAfJE79 https://t.co/pS48NIuwqX
  • Forex liquidity makes it easy for traders to sell and buy currencies without delay, and also creates tight spreads for favorable quotes. Low costs and large scope to various markets make it the most frequently traded market in the world. Learn more here: https://t.co/arxYmtQeUn https://t.co/gFVVZTGbe1
  • Forex quotes reflect the price of different currencies at any point in time. Since a trader’s profit or loss is determined by movements in price, it is essential to develop a sound understanding of how to read currency pairs. Learn how to read quotes here: https://t.co/CNtqrKWDBY https://t.co/nHXiNJhLes
  • A currency carry trade involves borrowing a low-yielding currency in order to buy a higher yielding currency in an attempt to profit from the interest rate differential. Find out if the carry trade suits your trading style here: https://t.co/7t4BzmLg8w https://t.co/h0TmJcZeqr
  • $USDCAD sold off aggressively last week, putting it into position to test the important 2017 low; trading bias is neutral to bearish. Get your market update from @PaulRobinsonFX here: https://t.co/sphxUAW9TB https://t.co/ZhsTeJOOM8
  • Get your snapshot update of the of top level exchanges and key index performance from around the globe here: https://t.co/d8Re5anlG5 https://t.co/qP96xmgDVn
  • The pro-risk Australian Dollar may extend gains after the record miss in US jobs data, amplifying dovish rhetoric from the Federal Reserve and keeping the Dow Jones and S&P 500 intact. Get your market update from @ddubrovskyFX here: https://t.co/yf8mPX3O3W https://t.co/uCCmjaxUhF
  • Who else is keeping close tabs on Dogecoin $DOGE this weekend? All eyes on Elon Musk @elonmusk, the proverbial 'Dogefather,' and his Saturday Night Live @nbcsnl performance kicking off at 11:30PM ET. The #crypto is already looking nice and perky following that trendline break! https://t.co/nrQsnlUqWj https://t.co/4lOz6NLQTG
  • There is some very interesting event risk over the opening half of this coming week of trade. It starts with Elon Musk hosting SNL tonight for Dogecoin traders and moves into US inflation data to as means to stir the ongoing Fed debate and Dollar https://www.dailyfx.com/forex/video/daily_news_report/2021/05/08/Dollar-Tumbles-Dow-Hits-Record-Highs-and-Dogecoin-Traders-Tune-In.html https://t.co/LXhjv7ToWC
Canadian Dollar Outlook: USD/CAD Drops to Support, Will it Break Out?

Canadian Dollar Outlook: USD/CAD Drops to Support, Will it Break Out?

Peter Hanks, Strategist

Canadian Dollar Outlook:

  • The Canadian Dollar has fallen to a nearby trendline, a level that has held price afloat since late 2017
  • Forming a series of lower highs dating back to 2016, the longer-term price chart suggests a break lower may occur
  • Still, support at the 1.3025 level has proved resilient and could keep USD/CAD trapped in its 2019 range

Canadian Dollar Outlook: USD/CAD Plummets to Support, Will it Break Out?

The Canadian Dollar was held to a tight range in 2019 versus the US Dollar, amid a flurry of conflicting fundamental and technical themes. While little progress was made compared to the first few days of the year, USD/CAD was able to establish a series of lower highs over the months, which align with the pair’s longer-term downtrend dating back to 2016. Now, USD/CAD is in position to probe an ascending trendline from September 2017 in a move that could see the pair extend its longer-term losses into the new year if bears are successful.

USD/CAD Price Chart: Weekly Time Frame (January 2016 – December 2019) (Chart 1)

usd cad chart

To be sure, the area near which price currently resides possesses a substantial amount of technical influence within the broader picture and has the potential to refute a move lower. Enjoying support from the trendline around 1.3100 and subsequent buoyancy around the pair’s July swing low at 1.3025. Coupled with the relatively quiet holiday trading conditions, the technical barriers may well stall a move lower for the time being which could allow for another retest of resistance around 1.3200 or even 1.3350.

USD/CAD Price Chart: Daily Time Frame (January - December 2019) (Chart 2)

chart of usd vs cad

That being said, it may only be a matter of time until USD/CAD extends beneath recent lows. Although the Canadian economy is showing signs of weakness, the Bank of Canada’s sole mandate is to control inflation, effectively forbidding rate cuts in pursuit of economic expansion. Since inflation in the Canadian economy is running at or above 2%, the odds of a weaker CAD due to lower interest rates are diminished.

On the other side of the pair, we have the Federal Reserve. When taking stock of the interest rate differential between the two currencies over the last year, it should be of little surprise USD/CAD suffered. Now at the onset of 2020, the Fed has effectively placed itself in a holding pattern as it gauges economic growth and inflation – but has left the door open for further rate cuts.

Consequently, USD/CAD appears to be on a knife’s edge headed into 2020. As the pair runs out of room between the two converging trendlines, traders will have to decide which factors warrant the most influence over price and dictate the appropriate reaction. While I have a slight bearish bias for the longer-term outlook, I believe a serious break lower will likely require another test of resistance overhead before a larger move can develop in the new year. In the meantime, follow @PeterHanksFX on Twitter for updates and analysis.

--Written by Peter Hanks, Junior Analyst for DailyFX.com

Contact and follow Peter on Twitter @PeterHanksFX

Read more:Stock Market Crashes: Current Climate Compared to Prior Conditions

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES