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.

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
GBP/USD
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
More View more
Real Time News
  • Commodities Update: As of 02:00, these are your best and worst performers based on the London trading schedule: Gold: -0.12% Silver: -0.30% Oil - US Crude: -1.23% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/b9pJgSOH8O
  • RT @Yeap_IG: #IGMorningthoughts: - 89% of #SP500 companies outperformed earnings thus far, but only 0.2% gain in SP500 since start of earni…
  • Gold prices risk forming a "Double Top" pattern - #GOLD chart https://t.co/pxGxpBTGPA
  • Forex Update: As of 02:00, these are your best and worst performers based on the London trading schedule: 🇯🇵JPY: 0.01% 🇪🇺EUR: -0.05% 🇨🇭CHF: -0.10% 🇨🇦CAD: -0.14% 🇦🇺AUD: -0.17% 🇳🇿NZD: -0.17% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/W36DdxonII
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Silver are long at 92.87%, while traders in Wall Street are at opposite extremes with 74.32%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/RKCkZLF5Pw
  • Keppel Corp is seeking to buy Singapore Press Holdings (SPH) for S$2.2 billion following the spin-off of its media assets, and plans to delist and privatize the company - BBG
  • S&P 500 Futures Lift Nikkei 225, Regulatory Risks Hit Chinese Stocks https://www.dailyfx.com/forex/market_alert/2021/08/02/SP-500-Futures-Lift-Nikkei-225-Regulatory-Risks-Hit-Chinese-Stocks.html https://t.co/bBmLaL5aHB
  • 🇰🇷 Markit Manufacturing PMI (JUL) Actual: 53 Previous: 53.9 https://www.dailyfx.com/economic-calendar#2021-08-02
  • Heads Up:🇰🇷 Markit Manufacturing PMI (JUL) due at 00:30 GMT (15min) Previous: 53.9 https://www.dailyfx.com/economic-calendar#2021-08-02
  • 7 out of 11 S&P 500 sectors ended lower, with 58% of the index’s constituents closing in the red. Consumer discretionary (-2.78%), energy (-1.76%) and utilities (-0.87%) were among the worst performers, whereas materials (+0.40%) and real estate (+0.32%) outperformed. https://t.co/qC0SSsqCyR
Canadian Dollar Outlook: USD/CAD Surge Hits Obstacles, Where to Next?

Canadian Dollar Outlook: USD/CAD Surge Hits Obstacles, Where to Next?

Daniel Dubrovsky, Strategist

Canadian Dollar, USD/CAD – Technical Analysis

  • Canadian Dollar index hinting that losses may be looming
  • USD/CAD struggling to hold push above the 100-day SMA
  • 4-hour chart analysis shows what obstacles could emerge

Majors-Based Canadian Dollar Index

The Canadian Dollar may be looking at near-term weakness against some of its developed counterparts. Taking a look at my majors-based CAD index below, which averages the Loonie against the US Dollar, Japanese Yen, British Pound and Euro, prices recently turned lower off the ceiling of an Ascending Triangle chart pattern.

Now, the 20-week Simple Moving Average seems to be coming into play as key support. A breakout under the line would expose the rising floor of the triangle, opening the door to near-term losses. Then, the trendline could come into play as key support and pivot the Canadian Dollar higher. The direction of the breakout after the triangle could hint at the next prevailing trend to come.

CAD Index - Weekly Chart

Canadian Dollar Outlook: USD/CAD Surge Hits Obstacles, Where to Next?

Chart Created in TradingView

USD/CAD Technical Outlook

In this week’s US Dollar technical forecast, I noted that USD/CAD could be readying to overturn the dominant downtrend since last year. But, this is where the 100-day Simple Moving Average is coming into play. While the pair broke above it last week, confirmation had not yet been achieved. On Monday, the pair turned back lower, undermining the initial push above the SMA.

This is leaving the pair around the 1.2365 – 1.2401 inflection zone once again. Immediately below, the 20-day SMA could cross above the 50-day equivalent. That would form a bullish crossover, hinting at further upside progress. A confirmatory push above the 100-day SMA could open the door to aiming for highs from April. Otherwise, a turn lower may place the focus on the 2018 low at 1.2250.

USD/CAD - Daily Chart

Canadian Dollar Outlook: USD/CAD Surge Hits Obstacles, Where to Next?

Chart Created in TradingView

USD/CAD Near-Term Outlook

Zooming in on the 4-hour chart can help reveal the kinds of obstacles USD/CAD could face if it tries to extend this month’s bottom. It is possible that a bounce off the 20-period SMA pushes the pair back to the key 1.24871 – 1.24640 resistance zone. There, a bearish Double Top chart pattern could emerge if prices aim back lower after testing the highs.

Keep a close eye on RSI, where negative divergence may also emerge. That is a sign of fading upside momentum which can at times precede a turn lower. Should prices fall under the 20-period SMA on the 4-hour chart timeframe, that would expose the 50- equivalent. It could come into play as key support, opening the door to reinstating the focus back higher. If not, all eyes would be back on early June lows.

4-Hour Chart

Canadian Dollar Outlook: USD/CAD Surge Hits Obstacles, Where to Next?

Chart Created in TradingView

--- Written by Daniel Dubrovsky, Strategist for DailyFX.com

To contact Daniel, use the comments section below or @ddubrovskyFX on Twitter

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

DISCLOSURES