The Canadian dollar continued making gains against the greenback getting closer to parity. Will it reconquer it now? The interest rate decision and retail sales are the highlights of this week. Here’s an outlook for the Canadian events and an updated technical analysis for USD/CAD. Inflation is on the rise in Canada, and this lowers the chances of a rate cut. But not all the figures are positive. Last week disappointing figures for the Canadian market with an unexpected decline to 7.92 billion in Foreign securities purchases after 12.13 billion in the preceding month, a negative reading of 0.1% in the leading index, contrary to the 0.2% gain predicted, and a smaller than expected increase of 0.2% in Wholesale sales. USD/CAD daily chart with support and resistance lines on it. Click to enlarge: Retail sales: Tuesday, 12:30. Canadian retail sales dropped more than predicted in July down 0.6%, with vehicle and auto-parts dealers accounting for most of the decline, Statistics Canada said Thursday. Economists expected sales to drop 0.3% in July. The main factor for this drop was a slide of 3.5% in car sales. Meanwhile Core sales remained flat while analysts predicted 0.2% rise. Retail sales are predicted to rise by 0.5% while Core sales is expected to increase by 0.4%. Rate decision: Tuesday, 14:00. Bank of Canada held Canada’s benchmark interest rate at 1.0% on September amid global economic hardships which affectedCanada’s growth in the second quarter. No change is expected this time. BOC Monetary Policy Report: Wednesday, 13:30. The Bank of Canada last Monetary Policy Report increased it inflation forecast expecting growth to pick up modestly in the next quarters and did not refer to the Euro-Zone debt crisis as a risk. *All times are GMT. USD/CAD Technical Analysis Dollar/CAD began the week with an initial dip under the 1.0080 line (mentioned last week), but recovered quickly and peaked at 1.0263. It then traded quite choppily and eventually managed to close below 1.0080, opening the road to parity. Technical lines, from top to bottom: We start from a lower point this week: the multiple and strong resistance line at 1.0677, last seen in August 2010. The pair got close to this level in October 2011 as well. 1.0550 provides minor resistance after temporarily capping the pair recently. 1.0500 is a minor resistance line. It was a pivotal around the same time and was a point of resistance before the pair fell. 1.0360 capped the pair in September and October and also provided support. 1.0263 is the peak of recent surges during October and is strong resistance now. The round 1.02 line capped the pair at the end of 2010 and was the low of 2009. It is now only a minor line. 1.0080 now becomes of high importance after switching positions. It was pivotal at the end of 2010. 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, 0.9915 was a peak back in June and is now minor support, after being run through recently. 0.9780, where the current run began is the next and important support line. Below, 0.9667 is of importance, followed by 0.9525. I remain bearish on USD/CAD. The chances of a rate cut were significantly cut with the strong inflation numbers. Add the positive job figures seen earlier and the improvement in the US economy on which Canada is dependent, and you get a challenge on USD/CAD parity. Also the recent rise in oil prices helps 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 â€“ 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. Iâ€™ve also worked as a community organizer Anat's Google Profile View All Post By Anat Dror Expert score 5 Etoro - Best For Beginner & Experts0% Commission and No stamp DutyRegulated by US,UK & International StockCopy Successfull Traders 5 Read Review Open My Free Account Your capital is at risk. Canadian Dollar ForecastMinors share Read Next NZD/USD: Trading the New Zealand CPI Release Kenny Fisher 10 years The Canadian dollar continued making gains against the greenback getting closer to parity. Will it reconquer it now? The interest rate decision and retail sales are the highlights of this week. Here's an outlook for the Canadian events and an updated technical analysis for USD/CAD. Inflation is on the rise in Canada, and this lowers the chances of a rate cut. But not all the figures are positive. 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