Canadian Dollar Forecast: Key USD/CAD Levels to Watch
19 Aug 2020 09:30, GMTWhat's on this page
CAD Analysis and Talking Points
- USD/CAD | Downtrend Remains Intact
- Unwind of Short CAD Positioning Risks Accelerating USD/CAD Losses
- Canadian Dollar Technical Levels
USD/CAD | Downtrend Remains Intact
The theme of US Dollar remains intact, particularly in USD/CAD with the persistent downtrend hitting fresh post COVID lows following a break below support at 1.3170. In turn, given that there is little in the way of notable support, USD/CAD raises the risk of accelerating losses towards the 1.3000 handle. Alongside this, the latest CFTC data highlights that speculators remain short on the Canadian Dollar and thus an unwind of bearish bets provides scope for USD/CAD to fall further. On the topside, resistance is situated at 1.3200, whereby below this level maintains the bearish bias in USD/CAD.
| Change in | Longs | Shorts | OI |
| Daily | -3% | -6% | -5% |
| Weekly | 24% | -17% | -4% |
Canadian Dollar Technical Levels
| Support | Resistance | ||
|---|---|---|---|
| 1.3065 | 38.2% Fib | 1.3200 | - |
| 1.3000 | - | 1.3250 | - |
| 1.2957 | 2020 Low | 1.3315 | Jun 10th Low |
Elsewhere, it is important to keep one eye on oil prices, which has also underpinned the recovery in CAD. In the short term, focus will be on the OPEC meeting, however, little is expected in the way of new policy as OPEC maintains its stance to gradual taper production cuts.
G10 FX Moving Averages
USD/CAD Price Chart: Weekly Time Frame
Source: IG Charts
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.