In the short term, the USD/CAD's dynamics will be determined by the publication of US statistics, the crude oil market and commodities data.
This week, oil prices have dropped after last week’s rally. A growing oil supply may support the USD/CAD pair, which has declined significantly since the beginning of the month.
Further macroeconomic events that may affect the pair dynamics are the Bank of Canada and the Federal Reserve meetings, due 21 and 28 October, respectively.
Given a decline in oil prices, the pair may strengthen to yesterday’s highs at 1.3070. A further growth is possible to the level of 1.3140 (23.6% Fibonacci and ЕМА200, 144 on the 4-hour chart).
At present, a decline is seen as a downward correction. The pair is heading to the key support level of 1.2820 (50% Fibonacci), near which there is EMA144 support level on the daily chart.
On the daily chart, OsMA and Stochastic are turning to long positions; at the same time, on the 4-hour chart, the indicators are giving sell signals.
- Support levels: 1.2965, 1.2910, 1.2875, 1.2820.
- Resistance levels: 1.3070, 1.3140, 1.3220, 1.3260.