Yesterday the US dollar dipped against the yen, the euro and the Swiss franc but rose against the Canadian dollar, which is heavily dependent on oil prices. Today, during the Asian session amid the Greek drama in Europe, oil prices remained under pressure, and the USD/CAD pair stabilized and continued to strengthen.
Today a bunch of US and Canadian news will increase volatility. Canadian GDP Rate for June is released at 15:30 (GMT+3) (+0.1% forecast compared to -0.2% in May). US Home Price Indices for April, Chicago Purchasing Manager’s Index for June and Consumer Confidence for June are published at 17:00 (GMT+3).
On Thursday, US Nonfarm Payrolls for June will draw market participants’ attention. Positive data will strengthen the US dollar.
Support and resistance
The pair USD/CAD is close to the strong support levels 1.2290 (23.6% Fibonacci level), 1.2325 (EMA200 and EMA144 on the 4-hour chart). Given the indicators, news data and falling oil prices, the US dollar will continue to strengthen. If the news does not come in at the forecast levels, a correction may happen, but, probably, not below the levels of 1.2345, 1.2325. OsMA and Stochastic indicators on the 4-hour and the daily charts are in the buy zone. The price is moving in the upwards channel and is located above the key support level 1.1975 (38.2% Fibonacci), 1.2010 (EMA200), 1.2150 (EMA144 on the daily chart), 1.2290 (23.6% Fibonacci level).
Support levels: 1.1975, 1.2010, 1.2150, 1.2290, 1.2325.
Resistance levels: 1.2425, 1.2560, 1.2600.
Open long positions from current levels and from levels 1.2345, 1.2325 targets at 1.2425, 1.2500 and stop-loss at 1.2280.
Alternative short positions should be considered after the breakdown of the level 1.2290 (23.6% Fibonacci) with the targets at 1.2150, 1.2010.