The Canadian dollar made nice gains against the greenback for a second week in a row. Will parity be broken now? Retail sales and leading index are the major events this week. Here’s an outlook for the Canadian events and an updated technical analysis for the Canadian dollar. Strong figures were released last week with a surge in foreign securities purchases reaching C$14.99 billion while way above the C$6.97billion predicted and Manufacturing sales increased better than predicted by 2.0%. The BOC released its monetary policy report announcing the bank predicts the Canadian economic recovery will continue “at a more modest pace” in light of the deepening crisis in the EU which will definitely affect the Canadian recovery unless contained by EU officials. Will the Canadian economy continue to expand? Updates: The Canadian dollar enjoyed the strength in oil prices, but USD/CAD couldn’t really fall below 1.0070. See how to trade the Canadian retail sales with USD/CAD. Core retail sales rose by 0.3%, stronger than expected. Nevertheless, parity is still far. With no new tensions around Iran, but new worries about Greece, USD/CAD is on the rise once again, challenging the 1.0143 line. USD/CAD parity is now in play after the big move in the US: Ben Bernanke extended the pledge for low rates until late 2014 and all the currencies rallied against the greenback. USD/CAD daily chart with support and resistance lines on it. Click to enlarge: Leading Index: Monday, 13:30. The composite leading index gained 0.8% in November climbing 0.3% in the prior month. Manufacturing components increased reflecting improvement in the market. Analysts expected 0.3% increase. Retail sales: Tuesday, 13:30. Canadian retail jumped by 1.0% in October driven by stronger sales of automobiles and gasoline. This is the third straight gain indicating expansion in the market. Economists predicted a mere 0.4% gain. Meantime Core sales climbed 0.7% in October, exceeding expectations for a 0.3% gain. WEF Annual Meetings: Wed-Sat. World Economic Forum meetings is held in Davos, Switzerland summoning central political and financial figures from over 90 countries to discuss global economic issues. The main goal is to find ways to balance and deleverage countries in order to avoid recession and financial bubbles, forming an integrated global management. * All times are GMT. USD/CAD Technical Analysis Dollar/CAD kicked off the week with a failed attempt to break above the 1.0263 line mentioned last week. It then dropped and eventually closed significantly lower, at 1.0108. Technical lines, from top to bottom: We begin from lower ground this time. 1.0550 is a minor line on the way up – a line which can slow the pair. 1.0500 is another minor line of resistance. It was a pivotal around the same time and was a point of resistance before the pair fell. 1.0430 provided support when the pair was trading at higher ground during November and was tested successfully also in December, making it stronger. 1.0360 capped the pair in September and October and also provided support. It is weaker now. The round number of 1.03 was the peak of a move upwards seen in November 2010 and has found new strength after working as a cap in January 2011. It is key resistance now. 1.0263 is the peak of surges during October, November and December, but was shattered after the move higher. The break above this line proved to be temporary, and it returned to the previous strength. The round figure of 1.02 was a cushion when the pair dropped in November, and also the 2009 trough. It is weaker now but remains pivotal. 1.0143 was a swing low in September and worked as resistance in the past. It is now a pivotal line. 1.0070 was a trough more than once in November, December and January. It is key support now. The very round number of USD/CAD parity is a clear line of course, and it will be closely watched on a potential downfall. Under parity, the round number of 0.99 provided support on a fall during October and also served as resistance back in June. 0.9830 provided support for the pair during September. 0.9780, where the current run began is the next and important support line. The last line for now is the veteran 0.9667 line. I am neutral on USD/CAD. On one hand, fresh positive US figures seen of late, together with high oil prices certainly help the Canadian dollar. Yet on the other hand, recent week domestic figures in Canada with the scary possibility of a housing bubble, weigh on the loonie. Further reading: For a broad view of all the week’s major events worldwide, read the USD outlook. For EUR/USD, check out the Euro to Dollar forecast. For the Japanese yen, read the USD/JPY forecast. For GBP/USD (cable), look into the British Pound forecast. For the Australian dollar (Aussie), check out the AUD to USD forecast. For the New Zealand dollar (kiwi), read the NZD forecast. For USD/CAD (loonie), check out the Canadian dollar For the Swiss Franc, see the USD/CHF forecast. Anat Dror Anat Dror Anat Dror Senior Writer I conceptualize, design and create multi-lingual websites. Apart from the technical work, my projects usually consist of writing content for these sites in English, French and Hebrew. In the past, I have built, managed and marketed an e-learning center for language studies, including moderating a live community of students. I've also worked as a community organizer Anat's Google Profile View All Post By Anat Dror Canadian Dollar ForecastMinors share Read Next GBP/USD Outlook January 23-27 Kenny Fisher 11 years The Canadian dollar made nice gains against the greenback for a second week in a row. Will parity be broken now? Retail sales and leading index are the major events this week. Here's an outlook for the Canadian events and an updated technical analysis for the Canadian dollar. Strong figures were released last week with a surge in foreign securities purchases reaching C$14.99 billion while way above the C$6.97billion predicted and Manufacturing sales increased better than predicted by 2.0%. 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