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"We continue to expect that underlying economic conditions - a strengthening U.S. economy and a weaker Canadian dollar - will lay the foundation for a boost in domestic manufacturing in the near term."
- Royal Bank of Canada (based on Reuters)
Pair's Outlook
USD/CAD has consolidated around 1.1050 as it is supported by uptrend support line and it has strong resistance levels ahead – 55-day SMA, monthly PP and weekly PP at 1.1086/99. Nevertheless, we think that the pair is capable of breaking these resistance levels ahead of it and move towards 1.1200. The fact that the pair is trading below 55-day SMA has to be taken into account as well and we see it as bullish signal.
Traders' Sentiment
Though the gap between the bullish and bearish market participants narrowed, it still remains rather big as 70% of them see the USD gaining against the CAD. Meanwhile, the percentage of orders set to acquire the Loonie increased, 63% compared to 54% yesterday.
© Dukascopy Bank SA