FxNews—The USD/CAD currency pair resumed its bullish trend after the prices exceeded the 1.395 (August 5 high) critical resistance, and there is active support now. The depreciation in the Canadian currency value was unexpected because the S&P/TSX composite index has been surging for three days.
The index increased 0.3%, hitting a new high, which means more investors are keen to invest in the Canadian stock market. Therefore, this increased the demand for buying Canadian Dollars.
Furthermore, today’s oil prices have increased, which has increased the share of companies in the energy sector. Suncor and Imperial Oil saw a 1.7% and 2.7% increase in their share value.
Typically, when the stock market does well, the currency‘s value should stabilize, but USD/CAD is affected by the Strong Greenback and new policies from President-Elect Donald Trump.
USDCAD Technical Analysis – 14-November-2024
The primary trend is bullish because the prices are above the 50- and 100-period simple moving averages. However, the Stochastic Oscillator and RSI hover in overbought territory, depicting 91 and 73 in the description.
This development in the momentum indicators suggests that the American dollar is overpriced. Therefore, a consolidation phase could be on the horizon.
Watch USDCAD Rally Towards 78.6% Fibonacci Level
The immediate support is at 1.395. The market outlook remains bullish as long as the prices are above the immediate support. In this scenario, USD/CAD will likely target the 78.6% Fibonacci retracement level at 1.409 after a minor consolidation.
Please note that the bullish outlook should be invalidated if USD/CAD falls below the 1.395 mark.
- Support: 1.395 / 1.385
- Resistance: 1.409 / 1.50