Canadian Dollar Forecast: USD/CAD Price – Tries to Build Higher
USD/CAD Technical Outlook
- Markets fluctuated between hopes of a V shape recovery and fears of a fresh wave of coronavirus cases.
- USD vs CAD price chart exposes a sideways move
USD/CAD Price – A Multi-week High
On Friday, USD/CAD rallied to a near four-week high at 1.3715 and closed the weekly candlestick in the green with a 0.6% gain.
The sharp take-off of the coronavirus cases last week sparked concerns about the economic recovery and kept demand on safe-haven currencies intact amid news about some US states reconsidered their reopening plans.
USD/CAD DAILY PRICE CHART ( Aug 2, 2018 – June 30, 2020) Zoomed Out
USD/CAD DAILY PRICE CHART (April 28 – June 30, 2020) Zoomed In
On June 16, USD/CAD corrected its downward trend and created a higher low at 1.3504. Last week, the price rebounded twice around the low end of the current trading zone 1.3511 – 1.3793 and rallied eyeing a test of the high end of the zone.
A close above the high end of the zone could signals that bulls could push towards the 1.4000 threshold and any further close above this level could extend the rally towards 1.4320.
On the other hand, a close below the low end of the zone could encourage bears to reattempt testing 1.3291. Any further close below that level opens the door for bears to press USDCAD even lower towards 1.3015.
USD/CAD four hour PRICE CHART (May 29 – June 30, 2020)
On June 24, USD/CAD broke above the lower downtrend line on the downtrend lines fan originated from the May 29 high at 1.3832, and generated a bullish signal.
A break above the higher downtrend line on the aforementioned fan would generate a bullish signal while a break below the uptrend line originated from the June 10 low at 1.3315 would produce a bearish signal.
Thus, a break above 1.3850 may trigger a rally towards 1.3968 in turn, any break below 1.3480 could send USDCAD towards 1.3401. Nonetheless, the weekly support and resistance marked on the four-hour chart should be considered.
Written By: Mahmoud Alkudsi, Market Analyst
Please feel free to contact me on Twitter: @Malkudsi
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.