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.

Free Trading Guides
Please try again

Live Webinar Events


Economic Calendar Events


Notify me about

Live Webinar Events
Economic Calendar Events






More View More
Canadian Dollar Outlook: USD/CAD Plummets to Major Uptrend Support

Canadian Dollar Outlook: USD/CAD Plummets to Major Uptrend Support

What's on this page

Canadian Dollar Technical Price Outlook: Near-term Trade Levels

  • Canadian Dollar updated technical trade levels – Daily & Intraday Charts
  • USD/CAD sell-off approaching critical long-term uptrend support around ~1.32
  • Key near-term resistance at 1.34 – break lower exposes 1.31

The Canadian Dollar offensive against the US Dollar continues into the start of August trade with USD/CAD breaking to fresh five-month lows. The decline takes price into a critical slope at long-term uptrend support and we’re looking for a reaction in price just lower. These are the updated targets and invalidation levels that matter on the USD/CAD price charts heading into the close of the week. Review my latest Weekly Strategy Webinar for an in-depth breakdown of this Loonie trade setup and more.

Canadian Dollar Price Chart – USD/CAD Daily

Canadian Dollar Price Chart - USD/CAD Daily - US Dollar vs Canadian Dollar Trade Outlook - Loonie Technical Forecast

Chart Prepared by Michael Boutros, Technical Strategist; USD/CAD on Tradingview

Technical Outlook: In my last Canadian Dollar Price Outlook we highlighted that our focus was on, “a break of the monthly opening-range for guidance with the risk weighted to the downside while below 1.3610.” USD/CAD registered an intraday high at 1.36 the following day before reversing sharply lower to break below the July opening-range lows and keeps the risk weighted to the downside near-term.

The decline is now approaching confluence support around ~1.3202 where the February lows converges on multi-year pitchfork support extending off the 2017 lows- look for a reaction there IF reached. A break lower keeps the focus on the 88.6% Fibonacci resistance at 1.3152 and the lower parallel (magenta) near ~1.3060s.

Canadian Dollar Price Chart – USD/CAD 120min

Canadian Dollar Price Chart - USD/CAD 120min - US Dollar vs Canadian Dollar Trade Outlook - Loonie Technical Forecast

Notes: A closer look at Loonie price action shows USD/CAD trading within the confines of a descending pitchfork formation extending off the late-June high. A break below the median-line risks a test of the lower parallel – which currently converges on the 1.32 confluence support zone. Initial resistance back at 1.3323 with near-term bearish invalidation now lowered to the August open at the 1.34-handle.

Forex for Beginners
Forex for Beginners
Recommended by Michael Boutros
New to Forex Trading? Get started with this Beginners Guide
Get My Guide

Bottom line: The USD/CAD sell-off is now approaching long-term uptrend support and while the immediate threat is lower, the decline may be vulnerable heading into this key region. From a trading standpoint, look to reduce short-exposure / lower protective stops on a test of the 1.32-handle – rebounds should be capped by the monthly open IF price is heading lower on this stretch with a close below trendline support needed to mark resumption of the March downtrend. Review my latest Canadian Dollar Weekly Price Outlook for a closer look at the longer-term USD/CAD technical trade levels.

For a complete breakdown of Michael’s trading strategy, review his Foundations of Technical Analysis series on Building a Trading Strategy

Canadian Dollar Trader Sentiment – USD/CAD Price Chart

Canadian Dollar Trader Sentiment - USD/CAD Price Chart - Loonie Positioning - US Dollar vs Canadian Dollar Technical Forecast
  • A summary of IG Client Sentiment shows traders are net-long USD/CAD - the ratio stands at +1.46 (59.39% of traders are long) – weak bearish reading
  • Long positions are13.65% lower than yesterday and 17.95% lower from last week
  • Short positions are 3.12% lower than yesterday and 8.60% lower 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. Yet traders are less net-long than yesterday and compared with last week. Recent changes in sentiment warn that the current USD/CAD price trend may soon reverse higher despite the fact traders remain net-long.
USD/CAD Bearish
Data provided by
of clients are net long. of clients are net short.
Change in Longs Shorts OI
Daily 4% -3% 1%
Weekly 17% -4% 7%
Learn how shifts in USD/CAD retail positioning impact trend
Get My Guide


Key US / Canada Data Releases

Key US / Canada Data Releases

Economic Calendar - latest economic developments and upcoming event risk.

Active Trade Setups

- Written by Michael Boutros, Currency Strategist with DailyFX

Follow Michael on Twitter @MBForex

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