- During the trading session on Thursday, we have seen the US dollar fall rather significantly against the Canadian dollar, but we have also seen the market turn around and show signs of life.
- The 1.43 level is an area that’s been important more than once, and therefore I think it does make a certain amount of sense that we’ve seen a bit of a reaction.
The market has shown itself to be noisy, but ultimately, this is a market that continues to see a lot of questions asked about the tariffs, which of course continues to see a lot of questions about what actually is going to happen. The market is obviously very noisy and unfortunately is going to be watching the latest tweets of Donald trumpet and Justin Trudeau. Ironically, I swear Justin Trudeau resigned, but the entire situation in Canada continues to be messy to say the least. So, by default, it’s likely that we will be paying attention to the Americans.
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Technical Analysis
The technical analysis for this USD/CAD pair is still bullish, but we have seen a bit of trouble recently, and therefore the question remains whether or not we can stay in this same area. After all, the 1.42 level underneath offered significant support, while the 1.43 level was at times as well. The 50 Day EMA is in this area as well, so I think it makes a lot of sense that we will see questions asked of this region. However, if we were to break down below the 1.4180 level, then the US dollar could drop down to the 200 Day EMA.
On the other hand, if we turn around and recapture the 1.44 level, it’s likely that the US dollar could go looking to the 1.45 level above, an area that has been crucial over the last month or so. Anything above there would probably involve the Canadians getting walloped with more tariffs. Ironically, the US economy slowing down might achieve the same thing, as 70% of Canadian exports to end up in the USA.
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