- USD/CAD trades in positive territory for two straight days, adding 0.03% on the day.
- The pair is poised to cross above the key EMA; RSI indicator returns to bullish territory above the 50-midline.
- The first upside barrier is located at 1.3460; 1.3395 acts as an initial support level for USD/CAD.
The USD/CAD pair extends the rally around 1.3550 during the early European trading hours on Thursday. The US Dollar (USD) has attracted some buyers following the Federal Reserve (Fed) meeting on Wednesday. The Fed committee agreed unanimously to keep the benchmark Federal Funds Rate at between 5.25% and 5.5% for the fourth straight month. Additionally, the decline in oil prices exerts some selling pressure on the commodity-linked Canadian Dollar (CAD) and acts as a tailwind for the USD/CAD pair.
According to the four-hour chart, USD/CAD is set to cross above the 50- and 100-period Exponential Moving Averages (EMA). The uptrend to resume once the pair can cross above the mentioned level decisively. It’s worth noting that the Relative Strength Index (RSI) returns to bullish territory above the 50-midline, supporting the buyers for the time being.
The upper boundary of the Bollinger Band at 1.3460 will be the immediate resistance level for the pair. Any follow-through buying above 1.3461 will see a rally to the 1.3500 psychological round figure. Further north, the next hurdle is seen at a high of January 25 at 1.3535.
On the other hand, a low of January 30 at 1.3395 acts as an initial support level for USD/CAD. A bearish breakout below the lower limit of the Bollinger Band at 1.3378 will pave the way to a low of January 31 at 1.3358, followed by the 1.3300 round figure, and finally near a low of January 2 at 1.3228.
USD/CAD four-hour chart
-638423649754823221.png)
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
AUD/USD continues soft as markets digest employment data
The AUD/USD declined by 0.34% to 0.6470 in Thursday's session, extending its decline to a fresh three-month low of 0.6460. The US Dollar is easing after mixed data, while weak Australian employment data has reduced inflationary concerns, which might change the outlook of the Reserve Bank of Australia.
EUR/USD: Further declines remain well in store
EUR/USD briefly tested fresh year-long lows on Thursday, piercing the 1.0500 handle for the first time in 54 weeks. A lack of meaningful EU data is doing very little to provide support for the Euro, and Fiber bids continue to tilt in favor of the safe haven US Dollar.
Gold falls as Powell signals Fed's patience on lowering rates
Gold recovers some ground on Thursday yet remains trading below its opening price for the fifth consecutive day, undermined by the Greenback’s advance for its own fifth consecutive day. A slightly hot inflation report in the US and solid jobs data sponsored XAU/USD’s leg down toward the 100-day SMA.
Ethereum Price Forecast: ETH could rally to $4,522 despite mixed on-chain flows among investors
Ethereum is down over 1% on Thursday following record net inflows across ETH exchange-traded funds in the past six days. Despite the bullish market outlook, $300 million worth of unstaked ETH could hit the market and cause downward pressure on prices.
Trump vs CPI
US CPI for October was exactly in line with expectations. The headline rate of CPI rose to 2.6% YoY from 2.4% YoY in September. The core rate remained steady at 3.3%. The detail of the report shows that the shelter index rose by 0.4% on the month, which accounted for 50% of the increase in all items on a monthly basis.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.