USD/CAD Price Analysis: Declines towards 1.3100

USD/CAD looks set for further breakdown as the US Dollar weakens further.
The underlying inflation in the US economy is clearly in a downtrend.
Momentum oscillators indicate more downside ahead.

Sagar Dua FXStreet

The USD/CAD pair trades back and forth in a narrow range near the round-level support of 1.3200 in the early New York session. The Loonie asset struggles for a direction amid decline in volume due to shortened week.

S&P500 futures added nominal gains in the European session, portraying higher risk-appetite of the market participants. The US Dollar Index (DXY) has printed a fresh five-month low near 101.30 as investors are expecting that the Federal Reserve (Fed) would continue the rate-unwinding program from March.

A sharp decline in the underlying inflation data released on Friday indicates that price pressures are clearly in a downtrend.

The oil price recovers strongly after Russian Deputy PM Alexander Novak said their companies are sticking to their obligations on supply cuts. It is worth noting that Canada is the leading exporter of oil to the United States and higher oil prices support the Canadian Dollar.

USD/CAD has been falling since the first day of November and is expected to decline further towards June 27 low, which is around 1.3117. Downward-sloping 20-day Exponential Moving Average (EMA) indicates that the near-term trend is bearish.

The Relative Strength Index (RSI) (14) hovers in the bearish range of 20.00-40.00, which indicates downside momentum is intact.

Going forward, a breakdown below intraday low of 1.3180 would expose the asset to July 25 low near 1.3150, followed by July 13 low around 1.3193.

In an alternate scenario, a recovery move above April 14 low around 1.3300 would drive the asset towards December 21 high at 1.3370. A breach of the latter would push the Loonie asset towards May 16 low at 1.3404.

USD/CAD daily chart

USD/CAD

Overview
Today last price	1.3187
Today Daily Change	-0.0013
Today Daily Change %	-0.10
Today daily open	1.32

Trends
Daily SMA20	1.3456
Daily SMA50	1.3626
Daily SMA100	1.3595
Daily SMA200	1.3495

Levels
Previous Daily High	1.3262
Previous Daily Low	1.32
Previous Weekly High	1.3409
Previous Weekly Low	1.3219
Previous Monthly High	1.3899
Previous Monthly Low	1.3541
Daily Fibonacci 38.2%	1.3224
Daily Fibonacci 61.8%	1.3238
Daily Pivot Point S1	1.3179
Daily Pivot Point S2	1.3158
Daily Pivot Point S3	1.3117
Daily Pivot Point R1	1.3242
Daily Pivot Point R2	1.3283
Daily Pivot Point R3	1.3304

Author

Sagar Dua

FXStreet

Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.

AUD/USD consolidates above 0.7000; remains close to monthly top

AUD/USD holds steady above 0.7000 during the Asian session on Friday, trading just below the previous day's monthly low amid diverging forces. A hawkish RBA continues to support the Aussie, while the recent decline in US bond yields keeps the US Dollar depressed near a three-week low. However, oil-driven inflation fears reinforce Fed hike bets, which, along with geopolitical risks, could benefit the safe-haven buck and cap the currency pair.

USD/JPY bounces off one-month low; climbs to 157.00 amid reviving USD demand

USD/JPY rebounds from the 156.00 neighborhood, or a one-month low touched during Friday’s Asian session, with bulls looking to extend momentum beyond 157.00 amid the emergence of some US Dollar buying. Meanwhile, Japan's National CPI rose to a nine-month peak and reaffirmed BoJ rate-hike bets, which could support the Japanese Yen and cap gains for the currency pair.

Gold treads water around $4,000

Gold prices maintain its offered stance in place at the end of the week, hovering around the key $4,000 threshold per troy ounce. The persistent selling bias in the precious metal comes amid decent gains in the US Dollar and an acceptable rebound in US Treasury yields across the curve, all alongside further upside traction in crude oil prices.

Crypto Today: Bitcoin holds the 50-day EMA as Ethereum and XRP face structural resistance

Bitcoin gradually ticks up on Friday, trading above $81,000. The Crypto King has recently defended structural support near $80,000, reinforcing the prevailing bullish outlook. Ethereum similarly edges higher above $2,400, while Ripple trades above $1.32 after testing support around $1.30.

The French bond panic is overdone. Here's what the market is misreading

France's 10-year government bond yield has climbed above 5%, reigniting fears of a sovereign debt crisis in the Eurozone. With public debt exceeding €3.5 trillion, persistent budget deficits and a fragmented political landscape, investors are increasingly questioning the French government's ability to stabilize its finances.

What November 3 means for the Fed's rate path and the US Dollar

The USD faces a decisive period ahead of the November 3 midterm elections. While markets anticipate another interest rate increase from the Fed in December, the battle for control of Congress could reshape fiscal policy expectations and, indirectly, the path of US monetary policy in 2027.