The USD/CAD pair, currently trading at 1.34727, is aiming to surpass the resistance level at 1.3500 due to the US Dollar’s strong performance.

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• USD/CAD eyes the 1.3500 resistance amid strength in the US Dollar.

The pair currently trades last at 1.34727.

The previous day high was 1.3466 while the previous day low was 1.3412. The daily 38.2% Fib levels comes at 1.3433, expected to provide support. Similarly, the daily 61.8% fib level is at 1.3446, expected to provide support.

The USD/CAD pair marches towards the psychological resistance of 1.3500 in the early New York session. The Loonie asset strengthens inspired by the solid US Dollar amid sticky inflationary pressures in the United States.

S&P500 is expected to open on a mildly negative note, following bearish cues from overnight futures. The US Dollar Index (DXY) rallied above the crucial resistance of 103.00 as investors remained worried that sticky inflationary pressures could force the Federal Reserve (Fed) to keep interest rates elevated for a longer period.

Hawkish Fed bets for September monetary policy meeting seem vanishing as the moderate pace in US inflation is in line with the central bank’s desired inflation rate of 2%. Last week, five-year consumer inflation expectations dropped to 2.9% from expectations and the former release of 3.0%.

Investors hope that Fed policymakers would be required to deliver more efforts now to rid of remaining inflationary pressures above the 2% desired above. Per estimates, consumer spending momentum remained at a higher pace of 0.4%, higher than June’s reading of 0.2%.

Meanwhile, investors shift their focus to the US Retail Sales for July, which will be released on Tuesday at 12:30 GMT.

On the Canadian Dollar front, investors await the inflation data for July, which will be published along with US Retail Sales data. Monthly headline Consumer Price Index (CPI) data is seen expanding at a higher pace of 0.3%, higher than the prior reading of 0.1%. Annual CPI is expected to land higher at 3.0% against the former release of 2.8%. A nominal inflation pace might not bother the Bank of Canada (BoC) in raising interest rates further.

Technical Levels: Supports and Resistances

USDCAD currently trading at 1.3468 at the time of writing. Pair opened at 1.3442 and is trading with a change of 0.19 % .

The pair remains strongly bullish on the daily timeframe. It trades above its 20 SMA @ 1.328, 50 SMA 1.3268, 100 SMA @ 1.3388 and 200 SMA @ 1.345.

The previous day high was 1.3466 while the previous day low was 1.3412. The daily 38.2% Fib levels comes at 1.3433, expected to provide support. Similarly, the daily 61.8% fib level is at 1.3446, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 1.3415, 1.3387, 1.3361
• Pivot resistance is noted at 1.3468, 1.3494, 1.3522

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