The US dollar has gone back and forth during the week, testing the 1.29 handle. The market looks likely to continue to be back and forth action more than anything else, as I see the 1.2750 level underneath as support. I think that the 1.30 level above is resistance, and I think there is a lot of resistance starting at the 1.29 level that will be very difficult to break above. I think a short-term pullback is possible, but I think that given enough time the buyers will return. Interest rates United States continuing to grind higher could also drive this market to the upside, even though we have oil markets showing signs of strength over all.
If we were to break down below the 1.2750 level, the market is likely to go looking towards the 1.25 handle underneath, a level that of course has a lot of psychological support, and of course there is an uptrend line underneath that should keep this market somewhat afloat as well. I think that the pullbacks will continue to be buying opportunities, but with the real prize would be is a break above the 1.31 handle. If we get that, the market can rise much farther, as the next target would be 1.38 or so. A breakdown below the uptrend line underneath would be catastrophic for this pair, as this trend line goes back several years. I do believe that we go higher though, there are far too many issues with the Canadian housing economy and of course raising interest rates in America should dictate higher pricing.
USD/CAD Video 07.05.18
This article was originally posted on FX Empire
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