The US Dollar (USD) inched higher against the Canadian Dollar (CAD) on Wednesday, increasing the price to more than 1.300. The price increase amid the release of major economic news. As far as the technical bias is concerned, it might remain bearish since the pair marked a lower low in the recent downside move.
USD/CAD: Technical Analysis
As of writing this piece, the USDCAD is being bid for the price around 1.3022 with multiple resistance levels coming ahead. Let’s start with the foremost resistance level which may be seen near 1.3052, it’s the major horizontal resistance level that may resist the price by pushing it back towards the downside. Next to it, the price may hit the 38.2% Fibonacci level ahead of 1.3220, the high of September 12, 2019, as shown in the graph below.
On the other hand, the price may also receive support around different levels including 1.2950, the trend line support level ahead of 1.2858, anther trend line support and then 1.2727, the major horizontal support level which may prevent the price from falling below the said level as shown in the graph above. The technical bias might remain bearish as long as 1.3085, the key horizontal resistance remains intact.
US Dollar (USD) Market Manufacturing PMI Release
The Markit Economics releases figures concerning manufacturing PMI which shows business conditions in the US specifically in the manufacturing sector. Since it comprises a large part of overall GDP, it is considered as an important indicator of business conditions and the net economic situation in the United States. Generally speaking, readings above 50 suggests that the economy is strengthened and the market is bullish for the USD, whereas a result below 50 points indicates a bearish market for the US Dollar (USD).
Considering the movement of the price over the past few days, trading USDCAD for a short term position might be a good idea to start with. However, long term position might also produce good results.