USD/CAD Daily Forecast – U.S. Dollar Tries To Move Higher Ahead Of The Weekend

USD/CAD Video 30.10.20.

U.S. Dollar Tries To Continue Its Upside Move

USD/CAD continues its attempts to settle above the resistance at 1.3330 as the U.S. dollar is gaining ground against a broad basket of currencies.

The U.S. Dollar Index received strong support near the 50 EMA at 93.60 and rebounded back to the 94 level. If the U.S. Dollar Index manages to settle above 94, it will gain additional upside momentum which will be bullish for USD/CAD.

Today, Canada reported that its GDP increased by 1.2% month-over-month in August compared to analyst consensus which called for growth of 0.9%.  Meanwhile, Producer Prices decreased by 0.1% month-over-month in September while analysts expected growth of 0.1%. In the U.S., Personal Income increased by 0.9% while Personal Spending grew by 1.4% month-over-month in September.

While economic reports are important, the attention of USD/CAD traders will likely shift to the upcoming U.S. presidential election which will be the main source of volatility in the upcoming week.

In addition, traders will pay attention to the latest developments on the coronavirus front as the situation continues to get worse in the U.S. If the market starts to price in the possibility of new lockdowns in the U.S., traders will increase their purchases of safe haven assets which will be bullish for the U.S. dollar.

However, it should be noted that this is a rather extreme scenario since there is no serious discussion about any lockdowns despite the alarming surge in the number of new COVID-19 cases in the U.S. in recent days.

Technical Analysis

USD to CAD is trying to gain more upside momentum above the nearest resistance level at 1.3330. If USD to CAD manages to settle above this level, it will move towards the next major resistance at 1.3420 although it may also face some resistance at the recent highs at 1.3390.

A move above the resistance at 1.3420 will open the  way to the test of the next resistance level at 1.3450.

On the support side, the nearest support level for USD to CAD has emerged at 1.3280. If USD to CAD moves below this level, it will get tot he test of the next support at 1.3260. A move below 1.3260 will push USD to CAD towards the support at the 50 EMA at 1.3235.

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