US Dollar Technical Forecast: EUR/USD, USD/CAD Face Critical Test
US Dollar Price Analysis and Talking Points:
EUR/USD Remains Soft
Since the rejection of the 200DMA the Euro has continued to trade on the defensive with the currency dipping below the 1.1000 handle. Momentum indicators continue to signal that the pair remains bearish, thus there is a risk of a move towards 1.0940-50. On the topside, intraday resistance is situated at 23.6% Fibonacci retracement at 1.1042. Focus today will be on Chair Powell’s testimony, however, given that the last Fed meeting was two weeks ago, we expect little in the way of new guidance from the Fed Chair.
October 15th low
October 8th low
EUR/USD Price Chart: Daily Time Frame (Nov 18 – Nov 19)
USD/CAD Upsides Faces Key Test
Since the dovish pivot from the Bank of Canada, weakness in the Canadian Dollar has shown little signs of easing with the currency trading at lowest against the greenback in over a month. That said, while risks remain tilted towards further upside in USDCAD, the pair will face its first key test at the 200DMA situated at 1.3275. In turn, this offers dip buying opportunities with pullbacks in the pair likely to be well supported with support at the low 1.32s. Closing above the 200DMA however, opens the door for a move towards 1.3345, which marks the October double top.
October Double Top
USD/CAD Price Chart: Daily Time Frame (Apr 19 – Nov 19)
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--- Written by Justin McQueen, Market Analyst
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.