USD/CAD Video 25.06.20.
U.S. Dollar Is Trying To Gain More Upside Momentum
USD/CAD has finally managed to get above the 20 EMA at 1.3600 and is trying to develop upside momentum.
This move is supported by U.S. dollar strength against a broad basket of currencies. The U.S. Dollar Index has gained a lot of ground in the last few days and is currently testing the resistance at 97.5.
Today, the U.S. has provided new Initial Jobless Claims and Continuing Jobless Claims reports. The Initial Jobless Claims report was worse than expectations as 1.5 million Americans filed for unemployment benefits in a week.
At the same time, the Continuing Jobless Claims report exceeded expectations as the number of workers who continued to receive unemployment benefits has finally declined below 20 million.
Another positive news was the rapid increase in Durable Goods Orders which were up 15.8% month-over-month in May.
The economic data remains grim but there are some green shoots so riskier assets may get some support. However, coronavirus continues to spread actively around the globe which can put more pressure on markets and provide additional support to the U.S. dollar which serves as a safe haven asset of last resort.
USD/CAD has managed to get above the 20 EMA at 1.3600 after it spent many trading sessions in the range between the support at 1.3500 and the 20 EMA. This is a major development which should lead for increased upside momentum for USD/CAD.
In case USD/CAD continues its upside move, it will soon find itself testing the next resistance at the 50 EMA at 1.3710. There’s also a resistance level at 1.3730 so USD/CAD will have to deal with this resistance area before it will be able to go higher.
If this attempt is successful, USD/CAD will head towards the next resistance level at 1.3800.
On the support side, the previous resistance at the 20 EMA will become the first support level for USD/CAD. In case USD/CAD manages to get below the 20 EMA, it will get back to the above-mentioned trading range between the support at 1.3500 and the 20 EMA.
For a look at all of today’s economic events, check out our economic calendar.