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 Technical Forecast: USD/CAD Gearing up for the Break

Canadian Dollar Technical Forecast: USD/CAD Gearing up for the Break

What's on this page

Canadian Dollar Technical Forecast: USD/CAD Weekly Trade Levels

  • Canadian Dollar updated technical trade levels - Weekly Chart
  • USD/CAD January rally halted at key pivot zone- US CPI on tap
  • Weekly support 1.2640, ~1.2424 (critical) – Resistance 1.2768-1.2814 (key), 1.2975-1.3023

The Canadian Dollar attempting to mount a counteroffensive against the US Dollar early in the month after USD/CAD rallied more than 2.7% off the January lows. The move takes price into a major technical pivot zone and we’re on the lookout for a possible exhaustion low in the days ahead. These are the updated targets and invalidation levels that matter on the USD/CAD weekly technical price chart heading into key US & Canada inflation reports. Review my latest Weekly Strategy Webinar for an in-depth breakdown of this Loonie technical setup and more.

Canadian Dollar Price Chart – USD/CAD Weekly

Canadian Dollar Price Chart - USD/CAD Weekly - Loonie Trade Outlook - USDCAD Technical Forecast

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

Notes: In last month’s Canadian Dollar Weekly Technical Forecast we highlighted the threat for deeper pullback in USD/CAD while noting to , “be on the lookout for a reaction / possible exhaustion low ahead of 1.2530s early in the month…” The US Dollar plummeted more than 3.7% off the December highs to briefly register an intra-week low at 1.2450 before rebounding off the lower parallel.

USD/CAD held key support at the 52-week moving average on a weekly close basis with the subsequent recovery stretching into key resistance into the close of January at 1.2768-1.2814- a region defined by the 61.8% Fibonacci retracement of the December decline and the 2021 high-week reversal close. A topside breach / weekly close above this threshold is needed to mark resumption of the broader uptrend with such a scenario exposing the median-line (currently ~1.29) and critical resistance at the 2020 yearly open / 38.2% retracement of the 2020 decline at 1.2975-1.3023. Initial weekly support rests at the yearly open at 1.2640 with broader bullish invalidation steady at the 52-week moving average / lower parallel near ~1.2524- look for a low ahead of this threshold IF USD/CAD is indeed heading higher.

USD Forecast
USD Forecast
Recommended by Michael Boutros
Download Our Latest Quarterly Dollar Price Forecasts!
Get My Guide

Bottom line: A rebound off uptrend support takes USD/CAD into a major technical pivot zone at 1.2768-1.2814- look for a break of the monthly opening-range for guidance with the broader outlook weighted to the topside while within this formation off the 2021 lows. From a trading standpoint, be on the lookout for an exhaustion low ahead of 1.2524 in the weeks ahead with a breach higher keeping the focus on slope resistance near the 2021 highs. Keep in mind we get key inflation reports from the US & Canada over the next week- expect volatility and be mindful of the weekly closes. Review my latest Canadian Dollar Price Outlook for a closer look at the near-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 Retail Positioning - USDCAD Technical Outlook
  • A summary of IG Client Sentiment shows traders are net-long USD/CAD - the ratio stands at +1.71 (63.1% of traders are long) – typically bearish reading
  • Long positions are4.68% lower than yesterday and 4.39% higher from last week
  • Short positions are 18.13% higher than yesterday and 12.58% 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. Traders are less net-long than yesterday but more net-long from last week. The combination of current positioning and recent changes gives us a further mixed USD/CAD trading bias from a sentiment standpoint.
USD/CAD Bullish
Data provided by
of clients are net long. of clients are net short.
Change in Longs Shorts OI
Daily -10% 4% -4%
Weekly -17% 37% 3%
Learn how shifts in USD/CAD retail positioning impact trend
Get My Guide


US / Canada Economic Calendar

US / Canada Economic Calendar - USD/CAD Key Data Releases - Loonie Weekly Event Risk

Economic Calendar - latest economic developments and upcoming event risk.

Active Weekly Technical Charts

--- Written by Michael Boutros, Technical 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.