USD/CAD Daily Forecast – Resistance At 1.2130 Stays Strong

USD/CAD Video 27.05.21.

Canadian Dollar Rebounds Against U.S. Dollar

USD/CAD faced resistance near 1.2130 and pulled back below 1.2100 while the U.S. dollar remained flat against a broad basket of currencies.

The U.S. Dollar Index has recently made an attempt to settle below the 90 level but failed to develop sufficient downside momentum. The nearest resistance level for the U.S. Dollar Index is located at 90.30. In case the U.S. Dollar Index gets to the test of this level, USD/CAD will get more support.

Today, foreign exchange market traders had a chance to take a look at several economic reports from the U.S.

Initial Jobless Claims declined from 444,000 to 406,000 compared to analyst consensus of 425,000. Continuing Jobless Claims decreased from 3.74 million to 3.64 million.

Durable Goods Orders unexpectedly declined by 1.3% month-over-month in April, but it looks that this surprise had little impact on markets.

The second estimate of the first-quarter GDP Growth Rate report indicated that GDP increased by 6.4% on a quarter-over-quarter basis compared to analyst consensus which called for growth of 6.5%.

Pending Home Sales declined by 4.4% month-over-month in April while analysts expected that they would grow by 0.8%. Recent housing market data indicates that sales are under some pressure due to strong growth of house prices, but more data is needed to see whether it’s a temporary pullback or a beginning of a correction.

Technical Analysis

usd cad may 27 2021

USD to CAD gained downside momentum and is currently trying to settle below the support at 1.2080. In case this attempt is successful, USD to CAD will get to another test of the support at 1.2065.

If USD to CAD settles below the support at 1.2065, it will head towards the next support level which is located at 1.2040. This support level has already been tested many times and proved its strength, and it looks that USD to CAD will need additional catalysts to settle below 1.2040.

On the upside, the nearest resistance level for USD to CAD is located at 1.2100. In case USD to CAD gets above this level, it will head towards the resistance at 1.2130. The 20 EMA is in the neaby, so USD to CAD will likely face strong resistance near this level. A move above 1.2130 will push USD to CAD towards the next resistance at 1.2170.

For a look at all of today’s economic events, check out our economic calendar.