USD/CAD daily chart with support and resistance lines on it. Click to enlarge:
- Manufacturing PMI: Thursday, 14:30. The index has shown slight improvement, pointing to slight expansion in each of the past three readings. In December, the indicator improved to 51.4, its highest level since February.
USD/CAD Technical Analysis
Technical lines from top to bottom:
We start with resistance at 1.3445, which has remained intact since the first week of June. 1.3385 is next.
The round number of 1.3300 has served in a resistance role since early December. 1.3265 follows.
1.3150 was tested in resistance early in the week, but has some breathing room following strong losses by USD/CAD late last week.
1.3100 (mentioned last week) has switched to a resistance role.
1.3048 is protecting the round number of 1.3000, which has psychological significance.
1.2916 was last tested in October 2018. 1.2830 is next.
1.2730 is the final support level for now.
I remain bearish on USD/CAD
The Canadian dollar continues its impressive December rally. The U.S. and China are set to sign the “Phase 1” trade deal, which has boosted investor risk appetite. As well, crude oil prices have jumped 11.4% in December, which is bullish for the loonie, has Canada is a major oil producer.
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