Canada Markets

Canadian Dollar Nears a Range of Potential Support

Cliff Jamieson
By  Cliff Jamieson , Canadian Grains Analyst
Connect with Cliff:
The Canadian dollar closed near unchanged on Thursday, while reaching a fresh low in the spot dollar exchange with the USD. The 20-day moving average has move below the 50- , 100- and 200-day moving average, a bearish signal. Support lies at $0.7759 CAD/USD, the 38.2% retracement of the move from the March 2020 low to June 1, 2021 high. The lower study shows investors moving to a bearish net-short futures position as of Nov. 23. (DTN ProphetX chart)

As seen on the attached chart, the spot Canadian dollar reached a recent high on Oct. 20 of $0.812031 CAD/USD, while reaching a fresh low in its short-term downtrend on Dec. 2 at $0.779776 CAD/USD.

Nearby support is seen at $0.78 CAD/USD, with trade dipping below this level while closing above it in two of the past three sessions. Given a breach of this psychological support, we look to a range of support from August/September lows ranging from $0.774821 reached on Aug. 20 to $0.777671 CAD/USD reached on Sept. 20.

Within this range falls the horizontal red line at $0.775927 CAD/USD, which represents the 38.2% retracement of the move from the March 2020 low to the $0.832016 high reached on June 1. In theory, a sustained breach of this level would result in a continued slide to the 50% retracement at $0.758601 CAD/USD.

The lower study shows that after a brief four-week period where investors added to their bullish net-long position in Canadian dollar futures each week, this group moved back to a bearish net-short position as of Nov. 30 of 3,135 contracts. This bears watching when the CFTC releases updated statistics on Dec. 3.


DTN 360 Poll

This week's poll, found on the lower-right side of your DTN Home Page, asks if you will consider pricing new-crop production? We value your opinion and thank you in advance for your response.

Cliff Jamieson can be reached at

Follow him on Twitter @Cliff Jamieson


To comment, please Log In or Join our Community .