The USD/CAD pair saw a spike in demand on Wednesday, climbing to the 1.3765-1.3770 range during the early European session, approaching levels not witnessed since mid-April. This upward movement seems to result from a mix of supportive elements, as traders await insights from the FOMC minutes for potential new direction.
The U.S. dollar has been gaining traction, reaching near six-week highs amid ongoing geopolitical tensions and increasing expectations for an interest rate increase by the U.S. Federal Reserve. Additionally, a slight dip in oil prices together with weaker-than-anticipated Canadian consumer inflation data has placed downward pressure on the Canadian dollar, or loonie, benefiting the USD/CAD pair.
On the technical front, current prices appear to be stable above the 50% Fibonacci retracement of the decline from March to May. Bulls are hopeful for a sustained push above the resistance posed by the 200-day exponential moving average (EMA), which would position them for an extension of the rally seen over the past few weeks, aiming for the 1.3550 level which marks the recovery from two-month lows.
The Relative Strength Index (RSI) is hovering around 60, and the favorable Moving Average Convergence Divergence (MACD) line indicates that bullish momentum is gaining strength. Yet, the USD/CAD pair will need to surpass the aforementioned resistance to develop a more favorable outlook. Potential gains could reach as far as the 61.8% Fibonacci level, aiming for 1.3806 on the path to the 78.6% retracement near 1.3876 and the recent peak around 1.3965.
For support, initial levels are at the 50% retracement around 1.3757, with additional backing at the 38.2% level close to 1.3708 and 23.6% retracement around 1.3647. However, if the current support fails, a deeper decline toward the 1.3549 mark cannot be entirely dismissed.
USD/CAD daily chart
USD price this week
The table below shows the percentage change of the US dollar (USD) against major currencies this week. The US dollar was the strongest against the Australian dollar.
| USD | EUR | GBP | JPY | CAD | australian dollar | new zealand dollar | swiss franc | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.24% | -0.51% | 0.17% | 0.12% | 0.57% | 0.13% | 0.47% | |
| EUR | -0.24% | -0.75% | 0.00% | -0.13% | 0.32% | -0.05% | 0.21% | |
| GBP | 0.51% | 0.75% | 0.70% | 0.63% | 1.08% | 0.71% | 0.94% | |
| JPY | -0.17% | 0.00% | -0.70% | -0.11% | 0.32% | -0.11% | 0.25% | |
| CAD | -0.12% | 0.13% | -0.63% | 0.11% | 0.43% | 0.00% | 0.31% | |
| australian dollar | -0.57% | -0.32% | -1.08% | -0.32% | -0.43% | -0.36% | -0.02% | |
| new zealand dollar | -0.13% | 0.05% | -0.71% | 0.11% | 0.00% | 0.36% | 0.23% | |
| swiss franc | -0.47% | -0.21% | -0.94% | -0.25% | -0.31% | 0.02% | -0.23% |
The heat map shows the percentage change between major currencies. The base currency is selected from the left column and the quote currency is selected from the top row. For example, if you select USD from the left column and move along the horizontal line to Japanese Yen, the percentage change displayed in the box represents USD (base)/JPY (estimate).
