The Canadian dollar continued to move higher last week, posting gains of 240 points, closing at 1.2994. This marked the first weekly close below the 1.30 line for the first time since October 2015. This week’s sole event is the Annual Budget Release. Here is an outlook on the major market-movers and an updated technical analysis for USD/CAD.
The Federal Reserve was very dovish in its policy statement, sending the greenback to lower levels. Canadian retail sales posted strong gains, helping the Canadian dollar continue its impressive rally.
Updates:
USD/CAD daily graph with support and resistance lines on it.
- Annual Budget Release: Tuesday, 16:00. The annual budget includes the government’s projected spending, income and borrowing levels. Any unexpected announcements regarding the budget can have a sharp impact on the movement of USD/CAD.
USD/CAD Technical Analysis
USD/CAD opened the week at 1.3236 and touched a high of 1.3405, as resistance held firm at 1.3457. The pair reversed directions late in the week, dropping all the way to 1.2921. USD/CAD closed the week at 1.2994.
Technical lines, from top to bottom
1.3457 held firm for a second straight week as USD/CAD posted gains before retracting.
1.3353 is the next line of resistance.
13174 was a cap in October 2015.
1.3064 is protecting the symbolic 1.30 line.
The round number of 1.2900 was a cushion in October.
1.2780 is the next support level.
1.2646 is the final support line for now.
I am neutral on USD/CAD
With no other Canadian releases this week, the annual federal budget will take on added significance. The government has promised fiscal stimulus, and if the markets like the package, the Canadian dollar could continue to rally.
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities.
Opinions are the authors — not necessarily OANDA’s, its officers or directors. OANDA’s Terms of Use and Privacy Policy apply. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.
Recommended Content
Editors’ Picks
EUR/USD clings to gains above 1.0750 after US data
EUR/USD manages to hold in positive territory above 1.0750 despite retreating from the fresh multi-week high it set above 1.0800 earlier in the day. The US Dollar struggles to find demand following the weaker-than-expected NFP data.
GBP/USD declines below 1.2550 following NFP-inspired upsurge
GBP/USD struggles to preserve its bullish momentum and trades below 1.2550 in the American session. Earlier in the day, the disappointing April jobs report from the US triggered a USD selloff and allowed the pair to reach multi-week highs above 1.2600.
Gold struggles to hold above $2,300 despite falling US yields
Gold stays on the back foot below $2,300 in the American session on Friday. The benchmark 10-year US Treasury bond yield stays in negative territory below 4.6% after weak US data but the improving risk mood doesn't allow XAU/USD to gain traction.
Bitcoin Weekly Forecast: Should you buy BTC here? Premium
Bitcoin (BTC) price shows signs of a potential reversal but lacks confirmation, which has divided the investor community into two – those who are buying the dips and those who are expecting a further correction.
Week ahead – BoE and RBA decisions headline a calm week
Bank of England meets on Thursday, unlikely to signal rate cuts. Reserve Bank of Australia could maintain a higher-for-longer stance. Elsewhere, Bank of Japan releases summary of opinions.