Canadian Dollar Technical Outlook: USD/CAD 2% Rally Puts Yearly Highs Back in Play
A sharp reversal from critical support has revived USD/CAD bulls, with a major resistance test now in focus that could determine the fate of the recovery.
Written by
Michael Boutros
Sr. Technical Strategist
Canadian Dollar Technical Outlook: USD/CAD Multi-Timeframe Analysis
USD/CAD technical analysis shows the pair rallying nearly 2.4% off a major pivot zone as Federal Reserve hike bets lift the U.S. dollar. Michael Boutros, StoneX Media Senior Market Analyst, breaks down the USD/CAD rebound across the weekly, daily and near-term charts. The rally now meets a dense cluster of Fibonacci retracement resistance and weekly closing levels that has capped the advance in the near term. Markets price a Fed rate hike in December as all but certain and an 88% chance of a second hike by March, keeping U.S. dollar strength in focus against the Canadian dollar. The pitchfork structure on the chart separates a routine pullback from a deeper washout and marks the break that would challenge the broader uptrend. U.S. producer price index data, jobless claims and a lineup of Fed speakers add event risk for the U.S. dollar and the Canadian dollar alike.
This content was created by an affiliate of StoneX Trading and represents the views and opinions of the author/speakers, not the views and opinions of StoneX Group Inc., or its subsidiaries. The content has not been independently reviewed by StoneX Trading.
Key USD/CAD Economic Data Releases
Active Short-term Technical Video Updates
- Swiss Franc Technical Outlook: USD/CHF Sharp Rebound Breaks October Downtrend
- Gold Technical Outlook: XAU/USD Bulls Fight to Hold Breakout Support After 7% Rally
- US Dollar Technical Outlook: DXY Bulls Fight to Hold Critical Support Ahead of NFP
- Euro Technical Outlook: EUR/USD Support Reversal Sets Up Breakout Test Ahead of NFP
- Australian Dollar Technical Outlook: AUD/USD October Breakout Reverses Toward Critical Support
- British Pound Technical Outlook: GBP/USD Reversal Threatens October Recovery
--- Written by Michael Boutros, Senior Technical Strategist
Follow Michael on X @MBForex
Latest market news
Web Trader platform
Our sophisticated web-based platform is packed with features.
Open an account today
Experience award-winning platforms with fast and secure execution.
Economic calendar
Related articles
USD/JPY Weekly Outlook: AI earnings could overshadow the Fed and BoJ
AI sentiment has become a major driver of US Treasury yields and USD/JPY. With Microsoft, Alphabet and Amazon reporting this week, central bank decisions may have competition for traders' attention.
Gold and S&P 500 analysis: What now after Warsh’s hawkish speech?
The dollar surged across the board after the Fed Chair Kevin Warsh surprised with a hawkish-leaning speech at the Jackson Hole summit. All the bearish dollar bets that had been accumulated since last Friday on the back of data weakness and bond market troubles had to be squared and that triggered a short squeeze rally for the dollar. Gold and silver dropped, as a result, as too did bitcoin, while US indices were giving back earlier gains.
EUR/USD forecast: All eyes on Warsh at Jackson Hole - Forex Friday
For much of this week, the EUR/USD has been edging lower with the US dollar regaining some ground after last week’s sell-off that was triggered, in part, by the bond market worries. Investors have been unwilling to bet further against the US dollar so far this week ahead of Kevin Warsh’s keynote speech at the Jackson Hole summit, due later today.