The USD/CAD pair shows a notable increase, reaching approximately 1.3770 during the early European session on Monday. The initial support level is identified at 1.3745, while the key resistance level to monitor stands at 1.3877. Market participants prepare for the release of the US ISM Manufacturing PMI report. The USD/CAD pair moves upward, approaching 1.3770 in the early European session on Monday. Nonetheless, an increase in crude oil prices after the United States’ capture of Venezuelan President Nicolas Maduro could strengthen the commodity-linked Loonie against the US Dollar.
The upcoming release of the US ISM Manufacturing Purchasing Managers Index data is set to be a focal point later on Monday. On Wednesday, the Canadian Ivey PMI report is set to be released. The figure is anticipated to show a modest increase to 48.3 in December, up from 48.2 in November. In the event of stronger-than-anticipated US economic data, this may lead to a slower pace of interest rate cuts this year, thereby bolstering the US Dollar.
In the daily chart, USD/CAD presents a bearish perspective as the price remains beneath the softly declining 100-day EMA at 1.3877. Bollinger Bands are contracting, with the price positioned beneath the upper band at 1.3839, indicating a decrease in volatility as upward momentum stabilizes. The RSI is positioned below the midline at approximately 46.01, suggesting a prevailing bearish momentum in the short term.
During pullbacks, the Bollinger middle band at 1.3745 provides initial support, whereas the lower band at 1.3649 serves as a foundation for the downside. Trend conditions would enhance with a consistent move above the 100-day EMA, whereas a failure to maintain the midline would shift attention to the lower band.