Affiliate Disclosure
Affiliate Disclosure DailyForex.com adheres to strict guidelines to preserve editorial integrity to help you make decisions with confidence. Some of the reviews and content we feature on this site are supported by affiliate partnerships from which this website may receive money. This may impact how, where and which companies / services we review and write about. Our team of experts work to continually re-evaluate the reviews and information we provide on all the top Forex / CFD brokerages featured here. Our research focuses heavily on the broker’s custody of client deposits and the breadth of its client offering. Safety is evaluated by quality and length of the broker's track record, plus the scope of regulatory standing. Major factors in determining the quality of a broker’s offer include the cost of trading, the range of instruments available to trade, and general ease of use regarding execution and market information.

USD/CAD Forecast: Key 1.38 Level in Focus

By Christopher Lewis
Christopher Lewis has been trading Forex and has over 20 years experience in financial markets. Chris has been a regular contributor to Daily Forex since the early days of the site. He writes about Forex for several online publications, including FX Empire, Investing.com, and his own site, aptly named The Trader Guy. Chris favours technical analysis methods to identify his trades and likes to trade equity indices and commodities as well as Forex. He favours a longer-term trading style, and his trades often last for days or weeks.
  • In my daily US dollar against Canadian dollar analysis, I noticed that the 1.38 level is an area that has been important multiple times in the past and it has been again on Wednesday.
  • Keep in mind we had a Bank of Canada announcement during the day on its interest rate monetary policy, etc. and they did cut interest rates by 25 basis points.
  • They also suggested that there were more to come but at the same time we got PMI numbers around the world looking a bit lackluster and mixed.

Traders at this point are probably banking on the Federal Reserve having to cut later this year as well so that might be part of the reason why we have not broken out. Plus, you also have to keep in mind that traders have already priced most of this in.

Top Forex Brokers

1
Get Started 74% of retail CFD accounts lose money Read Review

Hesitation, Again at this Point

We are starting to show signs of hesitation, so we could get a little bit of a pullback, and if we do, we could drop all the way back down to the 1.36 level where the 200-day EMA currently resides and still be in the same consolidation range. We will have to wait and see, but that is a potential action. If we were to break above the 1.3850 level, then it's likely that we could go looking to the 1.39 level.

USD/CAD Forecast Today 25/7: Key 1.38 Level in Focus (graph)

However, we are stretched, so I think it all makes a certain amount of sense that we get a little bit of a pullback in order to entice people to come in and buy the greenback over the Canadian dollar. In general, I don't want to short this USD/CAD pair. I do believe it goes higher over the longer term, if for no other reason than a slowing US economy is like a wrecking ball to the Canadian economy and if that is the case eventually, we will see the greenback gain but we are a little overdone at this point in time, but I am not looking to go against the grain and start shorting here either.

Ready to trade our Forex daily analysis and predictions? Here are the best Canadian online brokers to start trading with. 

Christopher Lewis
About Christopher Lewis
Christopher Lewis has been trading Forex and has over 20 years experience in financial markets. Chris has been a regular contributor to Daily Forex since the early days of the site. He writes about Forex for several online publications, including FX Empire, Investing.com, and his own site, aptly named The Trader Guy. Chris favours technical analysis methods to identify his trades and likes to trade equity indices and commodities as well as Forex. He favours a longer-term trading style, and his trades often last for days or weeks.
 

Most Visited Forex Broker Reviews