USD/CAD: Based on speculation Price Action-Based Increasing Volatility

VOT Research Desk

Nov1,2022

Market Analytics and Considerations

In recent price action, the USD/CAD pair has shown quite sharp twisting swings, and significant support is beginning to appear.

At the moment, the USD/CAD rate is close to 1.35725. Over the past few days, the currency pair’s volatility has increased. The USD/CAD rose to close to 1.36860 in early trading yesterday, but it quickly reversed lower after that. The USD/CAD’s lows on Friday, October 28, when it was close to 1.35250, are now within reach of the current downward trend.

In the past week, support levels in the USD/CAD have been tested a few times. Support levels in the USD/CAD have shown several reversals over the past week, with the 1.35000 target below appearing to be a psychological target. However, when this level has been taken into technical consideration, strong USD/CAD reversals have occurred. The Federal Reserve of the United States will raise its interest rate tomorrow, but what’s more important is that they will offer advice about possible future increases.

Lower USD/CAD has been indicating speculative plays. Selling activity may have real reasons for finally coming to an end after being within reach of a rather strong bullish stance for the past year. However, speculators ought to maintain some degree of skepticism regarding the selling action and employ a sound risk-taking strategy. The choppy conditions of the past week, when significant support appeared before strong upward reversals followed, are evidence of fragile trading conditions.

Traders who want to get ahead of the potential speculative curve and sell the USD/CAD now on the belief that the U.S. Federal Reserve will sound more dovish regarding its interest rate policy tomorrow are taking a dangerous risk if the 1.35100 becomes vulnerable.

In the near future, speculators should anticipate a lot of volatility and make sure the leverage they choose doesn’t let money disappear from their accounts due to costly mistakes.

Over the past week, the USD/CAD downward trend has been halted multiple times. There are indications that the downward trend may indeed become stronger and break through important support levels near the 1.35100 mark, but this is not a guarantee. The pursuit of lower USD/CAD values should not cloud traders’ judgment; instead, they should remain realistic about their targets.

The USD/CAD will undoubtedly undergo reversals higher as well; The choppy conditions have arrived quickly and will probably continue to be a major factor for the next 30 hours. The USD/CAD may be a profitable bet for those who want to sell when it reaches perceived resistance levels and seek immediate lower results.

Perspective for the Short Term:

Right Now, Resistance: Current Support: 1.358001.35510 High Goal:1.36310 Low Objective:1.35040

Moving Averages – Daily