USD/CAD Price Prediction – Test Of Support At 1.2830

Key Insights

• Rising oil prices provided support to commodity-related currencies, including Canadian dollar. 

• The Canadian currency gained strong momentum against the American currency. 

• A move below 1.2830 will push USD/CAD towards the support level at 1.2815.

U.S. Dollar Is Losing Ground Against Canadian Dollar

USD/CAD moved below 1.2850 as the Canadian dollar received support from strong oil markets.

Oil is currently driven by rising demand during the summer season and discussions of price cap for Russian oil. In case oil continues to move higher, commodity-related currencies will get more support.

The U.S. has recently released Case-Shiller Home Price report, which indicated that home prices increased by 2.3% month-over-month in April, compared to analyst consensus which called for growth of 2.8%. It should be noted that data for May and June will be more interesting as it will show the impact of the additional increase in mortgage rates.

Today, traders will also have a chance to take a look at CB Consumer Confidence report for June. The report is expected to show that CB Consumer Confidence declined from 106.4 in May to 100.4 in June.

It remains to be seen whether CB Consumer Confidence report will have an impact on currency dynamics as traders have already had a chance to take a look at the Michigan Consumer Sentiment report, which indicated that Michigan Consumer Sentiment decreased from 58.4 in May to 50 in June.

USD/CAD Settled Below The 20 EMA

USD/CAD managed to settle below the support at the 20 EMA at 1.2870 and is testing the next support level at 1.2830.

In case this test is successful, USD/CAD will move towards the next support, which is located at the 50 EMA at 1.2815. A move below this level will open the way to the test of the support at 1.2800.

On the upside, the previous support level at 1.2870 will serve as the first resistance level for USD/CAD. In case USD/CAD manages to settle back above this level, it will head towards the next resistance at 1.2900. If USD/CAD climbs above 1.2900, it will head towards the resistance at 1.2940.

For a look at all of today’s economic events, check out our economic calendar.

This article was originally posted on FX Empire

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