Canadian Dollar Forecast: USD/CAD Support Growing in Importance
Canadian Dollar Highlights:
- USD/CAD trading near the 13920 support level
- Sideways churn should resolve here shortly
USD/CAD trading near the 13920 support level
USD/CAD has been soft over the past couple of weeks, with it failing to gain much strength after coming off the 2016 highs. This doesn’t mean that it can’t firm up and reverse in-line with the trend higher since the start of the year, but it would help keep the upward bias well supported.
The level to watch is 13920, a confirmed break (daily close) below will have a larger decline underway. Looking to support after that point, there is a lower parallel tied to the channel off the March 18 high to watch. Right now that clocks in around the 13600 mark.
Reaching that point and turning higher will still keep the upside intact. If, however, the 13920 level holds from here or we only see a brief dip below and push to the upside, then be on the watch for a breakout above the upper parallel of the channel. A crossing of the upper parallel and then 14390 will put USD/CAD in good shape to take on the 2016 high again.
For now, in wait-and-see mode, but that could quickly change in the week ahead depending on how support is treated.
USD/CAD Daily Chart (13920 support to watch)
USD/CAD 4-hr Chart (contained inside channel for now)
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---Written by Paul Robinson, Market Analyst
You can follow Paul on Twitter at@PaulRobinsonFX
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.