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Canadian Dollar Trades around 1.34

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Looking at the U.S. dollar (USD) against the Canadian dollar (CAD), the greenback is seesawing around 1.34 during the early Asian trade session as we head into the end of the week.

Looking at the above one (1) hour MT 4 chart, the USD/CAD currency exchange rate recovered from a six week low but failed to break above a downward sloping trend channel in play since 21 July.

There are economic events on the Canadian calendar today. The United States will release monthly flash and manufacturing purchasing managers’ indices (PMI) data today. The world’s largest economy is also publishing monthly new homes sales data.

The European Union is also publishing a whole slew of monthly flash manufacturing and services purchasing managers’ indices (PMI) data today. Germany, France and the Eurozone are all releasing their monthly flash PMI data.

The United Kingdom will release monthly retail sales data and monthly Gfk consumer confidence data. They are also publishing monthly flash manufacturing and services purchasing managers’ indices (PMI) data.

With the lack of Canadian economic data, the CAD will react more to data out of the United States and Covid-19 headlines.

Daily Canadian Dollar Technical Analysis (USD/CAD)        

Looking at the above one hour chart, the USD/CAD Forex market looks ready to challenge the upside barrier in play at 1.3410 again. The MACD histogram is still bullish supporting more strength for the greenback. With that said there are many key layers of technical resistance on the way to the two hundred (200) day moving average. There is also a falling trend line from 14 July in play as well.

A break above that 200 day moving average opens the door to challenge the upside barrier at 1.3522 and then the falling trend line at 1.3555. Looking closer at price action, however, a daily close above 1.3410 opens the door to challenge 1.35 at first.

On the flip side, a daily close below 1.3370 opens the door for the falling channel trend support in play at 1.3340. The next downside barrier comes into play at 1.3315. The next layer of technical support lines up at 1.33 then the February low price point at 1.32 comes into play.

About David Frank

David has his MA and PhD in Economics. He is a technical analyst who has been trading in the Forex world for over a decade. As an analyst and trader, David believes in the big picture by blending together technical analysis with the fundamentals behind the scenes in the Forex and Bond markets. David’s trading strategy is unique. He blends an understanding of fundamental and macroeconomics with technical analysis to offer a unique view into Forex. He applies several strategies including carry long positions, to take advantage of high yields in non-volatile markets, as well as using quicker, chart related analysis for day trading.

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