Canadian Dollar technical forecast: USD/CAD battle lines drawn

By :  ,  Sr. Technical Strategist

Canadian Dollar technical forecast: USD/CAD weekly trade levels

  • Canadian Dollar reverses sharply off trend support
  • USD/CAD marks outside-weekly reversal – range breakout pending
  • Resistance 1.3545, 1.3685/91, 1.3881– support 1.3225, 1.3113 1.2990-1.3023(key)

The Canadian Dollar has been trading within a 3% range since the start of the year with USD/CAD setting the yearly opening-range lows at uptrend support. The February battle lines are drawn heading into Canada employment tomorrow. These are the updated targets and invalidation levels that matter on the USD/CAD weekly technical chart.

Discussing this USD/CAD setup and more in the Weekly Strategy Webinars beginning February 27th.

Canadian Dollar Price Chart – USD/CAD Weekly

Canadian Dollar Price Chart - USD CAD Weekly - Loonie Trade Outlook - USDCAD Technical Forecast

Chart Prepared by Michael Boutros, Technical Strategist; USD/CAD on TradingView

Technical Outlook: The Canadian Dollar has ben trading within the confines of an ascending pitchfork formation extending off the October 21’ and June 22’ lows (blue) with USD/CAD marking an outside-reversal candle off uptrend support last week. Price has been in a massive consolidation pattern since the September rally and we’re looking for a breakout in the days ahead to offer guidance here.

Initial resistance stands with the objective yearly open at 1.3545 backed by the yearly opening-range highs / 61.8% retracement of the October decline at 1.3685/91- a breach / weekly close above this threshold is needed to mark resumption towards the 2022 high-week close at 1.3881.

Initial support rests with the lower parallel and is backed closely by the 38.2% retracement of the 2021 advance at 1.3225. A break / weekly close below this threshold would threaten a larger correction towards the 52-week moving average at ~1.3113 and key support / bullish invalidation at 1.2990-1.3023- look for a larger reaction there IF reached.

Bottom line: A reversal off uptrend support keeps the focus on a breakout of the 1.3225-1.3545 range for guidance. From at trading standpoint, losses should be limited to the lower parallel IF price is indeed heading higher with a close above the 2023 open needed to challenge the yearly opening-range highs towards the 1.37-handle. I’ll publish an updated Canadian Dollar short-term outlook once we get further clarity on the near-term USD/CAD technical trade levels.

Key Economic Data Releases

Canadian US Econmic Calendar - USD CAD Key Data Releases - USDCAD Weekly Event Risk 

Economic Calendar - latest economic developments and upcoming event risk.


--- Written by Michael Boutros, Sr Technical Strategist with

Follow Michael on Twitter @MBForex

Related tags: USD CAD Michael Boutros

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