Skip to Content
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. See our updated Privacy Policy here.



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

Live Webinar

Live Webinar Events


Economic Calendar

Economic Calendar Events

Free Trading Guides
Please try again
More View More
Canadian Dollar Forecast: USD/CAD Sell-Off Accelerating Into Support

Canadian Dollar Forecast: USD/CAD Sell-Off Accelerating Into Support

Nick Cawley, Senior Strategist

USD/CAD Price, Chart, and Analysis

  • USD/CAD testing short-term moving average support.
  • Traders have cut their long exposure over the week.

Keep up to date with all market-moving data releases and events by using the DailyFX Calendar

Dow Jones Resilient After FOMC Rate Decision, Updated Rate Projections

The latest FOMC rate decision (see link above) and subsequent press conference suggested that the Fed will announce a bond tapering timetable at the November meeting, while moves in the Fed’s dot plot also suggested a rate hike in 2022 may be on the cards. The mildly hawkish outtake from yesterday’s meeting is not being felt by the US dollar today with the DXY slipping lower after rallying for the last couple of weeks. It may be that the greenback got ahead of itself going into the FOMC meeting and today’s drift lower is just balancing out the recent bullish price action.

USD Forecast
USD Forecast
Recommended by Nick Cawley
Get Your Free USD Forecast
Get My Guide

USD/CAD has been a volatile pair of late with the ATR hitting multi-week highs. This volatility is a combination of pre-FOMC US dollar price action and the recent swings seen in the oil market with Brent crude jumping around $10 a barrel in the last month. Both Brent and US crude are close to or touching, multi-week highs.

Moving Averages (MA) Explained for Traders

The recently supportive USD/CAD trendline has once again turned into resistance. The pair are now testing the 20-day simple moving average, an indicator that has held for the last two weeks. The 50-day sma sits just 40 pips lower and should provide a secondary layer of support, having held for the last three months. Today’s sell-off may well reverse in the short-term but if oil remains bid then USD/CAD may continue to fade lower over the shorter- to medium-term.

USD/CAD Daily Price Chart September 23, 2021

Retail trader data show 54.07% of traders are net-long with the ratio of traders long to short at 1.18 to 1. The number of traders net-long is 11.29% higher than yesterday and 30.41% lower from last week, while the number of traders net-short is 16.16% lower than yesterday and 35.51% higher from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests USD/CAD prices may continue to fall.Positioning is more net-long than yesterday but less net-long from last week. The combination of current sentiment and recent changes gives us a further mixed USD/CAD trading bias.

USD/CAD Bearish
Data provided by
of clients are net long. of clients are net short.
Change in Longs Shorts OI
Daily 13% 3% 9%
Weekly 52% -9% 20%
What does it mean for price action?
Get My Guide

What is your view on USD/CAD – bullish or bearish?? You can let us know via the form at the end of this piece or you can contact the author via Twitter @nickcawley1.

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