USD/CAD Remains At Risk, US GDP Next
- USD/CAD declined heavily from the 1.3220 resistance zone.
- A major hurdle is forming near 1.2960 on the 4-hours chart.
- Federal Reserve officials raised interest rates by 75 basis points for the second straight month.
- The US Gross Domestic Product could grow 0.4% in Q2 2022 (Preliminary).
USD/CAD Technical Analysis
The US Dollar formed a major top near the 1.3220 zone against the Canadian Dollar. USD/CAD declined heavily below the 1.3120 and 1.3000 levels.
Looking at the 4-hours chart, the pair even settled below the 1.3000 level, the 100 simple moving average (red, 4-hours), and the 200 simple moving average (green, 4-hours). It spiked below the 1.2900 level and tested the 1.2820 support zone.
The pair is now consolidating losses above the 1.2850 level. On the upside, the pair is facing a major resistance near the 1.2960 zone and the 100 simple moving average (red, 4-hours).
A close above the 1.2960 level could open the doors for a steady increase. The next major resistance could be near the 1.3020 level. It is near the 50% Fib retracement level of the key decline from the 1.3225 swing high to 1.2816 low.
Any more gains might send the pair towards the 1.3120 level. If there is no upside break, the pair could correct lower and dip below 1.2810.
The next major support is 1.2800, below which the pair could accelerate lower towards 1.2750. Any more losses might send the pair towards the 1.2640 zone.
Looking at EUR/USD, the pair is still struggling below the 1.0280 resistance level and remains at a risk of more losses in the near term.
- US Initial Jobless Claims - Forecast 253K, versus 251K previous.
- US Gross Domestic Product Q2 2022 (Preliminary) – Forecast 0.4% versus previous -1.6%.