USD/CAD bounces up from 1.2350 and approaches 1.2400

The US dollar, contained at 1.2350, returns to levels near one-week highs at 1.2400.
The greenback bounces up after upbeat housing, manufacturing data.
USD/CAD is expected to rally towards 1.25/26 after BoC – Scotiabank.

Guillermo Alcala FXStreet

The US dollar has shrugged off previous weakness and bounced up from session lows at 1.2350 against its Canadian counterpart, returning to levels right below 1.2400 and turning positive on daily charts.

The dollar bounces up after US data

The greenback has bounced up, to regain lost ground following a soft performance during the Asian and European trading sessions. Better than expected US new home sales and the strong performance of the Richmond Fed Manufacturing Index seem to have reactivated confidence in the US dollar, pushing the pair back to levels near the one-week top, at 1.2400.

Sales of new homes have surged 14% in the US in September, hitting a six-month high rate of 800,000 units and beating market expectations of 760,000 units sold. Furthermore, the Richmond Fed Manufacturing Index improved to 12, from -3 in the previous month, with all components: shipments, new orders, and employment showing advances. On the negative side, home prices have increased below expectations.

The Canadian dollar had edged up earlier, buoyed by higher oil prices and improved market sentiment on the back of strong corporate earnings. The CAD, however, remains heavy, with the market positioning for a dovish BoC monetary policy statement later this week.

USD/CAD to appreciate towards 1.25/26 after BoC – Scotiabank

The FX Analysis team at Scotiabank expects the pair to advance further this week, with a dovish BoC increasing negative pressure on the CAD: “We look for narrow range trading for the CAD ahead of tomorrow’s policy decision and feel the risk of soft-pedaling nearer-term rate expectations might nudge the CAD somewhat lower in the short-run. USD gains to the 1.25/1.26 will very likely be met with renewed USD supply, however.”

Technical levels to watch

USD/CAD

Overview
Today last price	1.2387
Today Daily Change	0.0004
Today Daily Change %	0.03
Today daily open	1.2383

Trends
Daily SMA20	1.2493
Daily SMA50	1.2597
Daily SMA100	1.2518
Daily SMA200	1.2496

Levels
Previous Daily High	1.24
Previous Daily Low	1.2338
Previous Weekly High	1.241
Previous Weekly Low	1.2288
Previous Monthly High	1.2896
Previous Monthly Low	1.2494
Daily Fibonacci 38.2%	1.2377
Daily Fibonacci 61.8%	1.2362
Daily Pivot Point S1	1.2348
Daily Pivot Point S2	1.2312
Daily Pivot Point S3	1.2286
Daily Pivot Point R1	1.2409
Daily Pivot Point R2	1.2436
Daily Pivot Point R3	1.2471

Author

Guillermo Alcala

FXStreet

Graduated in Communication Sciences at the Universidad del Pais Vasco and Universiteit van Amsterdam, Guillermo has been working as financial news editor and copywriter in diverse Forex-related firms, like FXStreet and Kantox.

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