USDCAD Weekly analysis 02/02/2025
Satheesh V
Fundamental analysis
1. Overview of Momentum and Market Structure
Current Momentum: Bullish.
Previous Week's Performance: Bullish.
Range: 1.4333 – 1.4594
Expectations: Anticipating a bullish continuation within the range, targeting higher liquidity levels.
Trading Plan
Bullish Bias
Strategy:
Watch for price reactions at the following support zones for potential long entries:
1.4369 (H4 Liquidity)
1.4359 (Weekly Open)
1.4332 (H4 Liquidity)
Targets:
Primary targets: 1.4558 (H4 Liquidity) and 1.4594 (H4 Liquidity).
Extended target: 1.4721 (Extension Level).
For Shorts
Strategy:
Monitor price action at the following resistance levels for potential reversals:
1.4558 (H4 Liquidity)
1.4594 (H4 Liquidity)
1.4721 (Extension Level)
Confirmation:
Look for reversal patterns such as bearish engulfing candles or order block formations before entering short positions.
Targets:
Primary Targets: 1.4369 (H4 Liquidity) and 1.4359 (Weekly Open).
Extended Target: 1.4332 (H4 Liquidity).
Summary
The bias remains bullish within the 1.4333 – 1.4594 range.
Long entries are favorable around support levels with confirmation.
Short opportunities may arise near or above 1.4594 if signs of exhaustion emerge.
Use your strict money management rules to manage risks effectively.
Technical analysis
USD/CAD retreats below 1.4400 as the Canadian Dollar rebounds, gaining 0.65% amid broad US Dollar weakness. Market sentiment improved after Trump delayed tariff implementation until March, easing fears of immediate trade disruptions.
Despite Canada’s weaker-than-expected GDP contraction of -0.2% in November, the impact on CAD was limited. Meanwhile, US PCE inflation aligned with forecasts, reinforcing expectations of a cautious Fed. With risk appetite recovering, the Loonie finds short-term support.
