The USDCAD experienced a decline in the European and early North American sessions but rebounded strongly after testing support near 1.3813, its earlier weekly floor. This upward swing has brought the pair back to the swing area between 1.38337 and 1.38475, with the price momentarily reaching 1.3852 and encountering resistance.
Currently, buyers are in control, and breaking above 1.38475 could propel the USDCAD toward 1.3864 and 1.3888. If the pair surpasses 1.3888, the next target will be the August high of 1.39458.
Canada’s political instability, potentially leading to an election, is contributing to the CAD’s weakness. Additionally, reports of reduced immigration may negatively impact growth and increase inflation due to rising service worker costs.
Key Levels to Watch:
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Resistance: 1.38475
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Next upside Targets: 1.3864, 1.3888
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August High is a another target: 1.39458
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Support: 1.3813. Move below and a swing area near 1.3790 would be targeted
In the short term, maintaining prices above 1.3475 will fuel further upward momentum, solidifying the buyers’ control.
This article was written by Greg Michalowski at www.forexlive.com. Source