USD/CAD Forecast: Losses Erased, Eying At 1.29 Ahead Of FOMC

The USD/CAD price forecast is bullish as the bears paused near key levels and resumed the bullish momentum. The pair rallies as the Dollar Index have ended its sell-off, and now it seems poised to resume its upside. Better than expected US data helped the USD to rise again.

Photo by Michelle Spollen on Unsplash

The DXY’s upside continuation forces the Greenback to appreciate versus all its. Technically, the price was in a temporary retreat after reaching the 1.2895 level yesterday. Still, the decline was expected to be only temporary as the Dollar Index was bullish despite the minor retreat.

Furthermore, the USD/CAD pair has come back in the buyers’ territory. So, further rise is on the cards. As you already know, the USD received a helping hand from the United States economic data, which has come in better than expected.

Building Permits jumped from 1.63M to 1.73M in the last month beating the 1.60M estimate. The Current Account rose as well, being located at -190B above -193B expected. In comparison, the Housing Starts indicator was reported higher at 1.62M in August versus 1.55M forecast compared to 1.55M in July.

The Canadian NHPI registered a 0.7% growth versus 0.8% expected. Technically, the USD/CAD is bullish, but the fundamental factors will move the pair tomorrow. The FOMC meeting represents a high-impact event, so anything could happen.

USD/CAD price technical forecast: Strongly bullish momentum

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USD/CAD 4-hour price forecast

USD/CAD 4-hour price forecast

The USD/CAD price has found support around the 1.2762 former high. The resistance has turned into a support level. The price dropped after registering a false breakout with great separation above the channel’s upside line.

It has failed to stabilize under the descending pitchfork’s upper median line (UML), signaling strong buyers. We cannot exclude a temporary decline or a sideways movement after the current rally in the short term. Channel’s upside line remains an important upside target. The USD/CAD pair could approach and reach it if the Dollar Index approaches and reaches new highs. A temporary retreat or a temporary range could bring new long opportunities.

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