USD/CAD Forecast Today - 19/07: Loonie Pressured (Chart)
Date
7/19/2024 3:07:56 AM
(MENAFN- Daily Forex)
During my daily USD/CAD analysis, I noticed that this is a pair that continues to pressure the upside, and I think it's probably only a matter of time before we truly find a lot of momentum entering this market. It's obvious that the 1.37 level has been rather significantly resistant, so recapturing that area and closing above it on a daily chart would probably be the first sign that we are ready to go much higher.
It's worth noting that the 50-Day EMA sits just below, and it has offered significant support over the last couple of days. With this being the case, I think you have got a situation where traders continue to look at this through the prism of a market that is more likely than not going to continue to be bullish, but choppy. Keep in mind that this market has been sideways for a while, with the 1.36 level underneath offering massive support, while the 1.38 level above is the ceiling.
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Speaking of the 1.36 level, we have the 200-Day EMA offering technical support and of course a lot of interest. All things being equal, this is a market that I think will end up being one that surprises some people want to finally breakout, but as we are in the middle of summer, I anticipate that we have a situation where the pair will more likely than not just bounce around, yet positive
I think this is a situation where we are overall sideways, yet we are going to be positive as the interest rate differential must certainly favors the United States, as the Bank of Canada has already cut rates. On the other hand, the Federal Reserve is not cut rates yet, and even if they were to do so, it would simply set the interest rate differential between the 2 countries back to where was 6 months ago, meaning that the US dollar still pays at the end of every day to hold on to against the Canadian dollar. I think this is most of what the institutional traders out there will be paying attention to.
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