USD/CAD Is Attempting To Recover From Its Recent Pullback, W

(MENAFN- Daily Forex) The U.S. dollar looks as if it is trying to find a bit of a floor at the moment, as we are looking likely to see come interest rate players getting involved during the day.

USD/CAD

The U.S. dollar has pulled back a little bit against the Canadian dollar over the last several days, and now it looks as if, on Wednesday, we are trying to turn things around.

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We are hanging around the 50-day EMA, which, of course, is an important technical indicator. A lot of people will be watching it to see whether or not it can offer some type of support. Ultimately, this is a market that I think, given enough time, will perhaps try to change the overall attitude.

Resistance above

The 1.4250 level is a major resistance barrier and an area where we've seen a lot of noise. With this being said, I believe that this is a market that will try to find its way back to the 1.4250 level. If the market were to break down from here, it could open up the possibility of a test of the 200-day EMA.

But the interest rate differential continues to favor the U.S. dollar, and, quite frankly, the case for higher rates in Canada is all but nonexistent. Canadian inflation was heavily tilted due to gasoline. It had really nothing to do with accelerating inflation, so the Bank of Canada is probably a non-factor here

We will have to watch the interest rate differential. We'll have to watch how rates move in the United States. If they start to pick up again, that should be good for the dollar.

EURUSD Chart by TradingView

This looks like a pullback that some traders may be looking at for some type of technical setup based on the 50% Fibonacci retracement of the double bottom that occurred in early September. So, I think at this point, I'm buying dips. It looks like we're already trying to go to the upside, so we'll see if there's any follow-through.

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