USD/CAD Exchange Rate Approaches Key Resistance
As the USD/CAD chart shows, the Canadian dollar has weakened against the US dollar over the week today, the USD/CAD rate is near two-week highs.
According to Reuters, this has been influenced by:
the strengthening of the USD against other currencies;
the anticipation of retail sales data, which could affect the outlook for a potential rate cut by the Bank of Canada. The Retail Sales data will be released today at 15:30 GMT+3.
How might the Canadian dollar's exchange rate change against the greenback?
According to the technical analysis of the USD/CAD chart:
In 2024, the price action indicates the formation of a narrowing triangle with a median around the 1.368 level, which can be interpreted as a frequent compromise price between buyers and sellers.
On 11 July, an important event occurred the price dropped below the 1.36 level, which is under the lower boundary of the triangle, but it sharply recovered indicating bullish aggression and a false breakout of the multi-month low.
After this, the price began to rise towards the upper boundary of the triangle. In this process, the 1.3655 level changed its role from resistance to support (shown with arrows).
Thus, the dominance of bullish forces in the second half of July has brought the USD/CAD rate to the upper boundary of the triangle it is possible that in light of today's news, the price may reach this boundary. In that case, one should be prepared for the key resistance to show its influence.
Read more: https://fxopen.com/blog/en/oa-usd-cad-exchange-rate-approaches-key-resistance/
Text source: Forex Trading Blog
