The USD/CAD increased and resumed the yesterday’s bullish candle. Price has managed to climb above an important confluence area, a valid breakout could accelerate the upside movement. However, you should know that the rate remains under selling pressure because is located below some very important resistance levels.

The USD has managed to drag the price higher even if the USDX has dropped significantly today. The dollar index has squeezed a little in the last hours despite the mixed United States data. Is very important to see what will really happen on the USDX in the upcoming period because has failed to stay in the buyer’s territory.

Personally, I believe that only a breakout above the 93.30 level will confirm a further increase and a USD dominance. The Loonie dropped further even if the Canadian Building Permits dropped by 7.7% in November, more versus the 0.7% estimate, the indicator plunged after the 4.4% growth in the former reading period.

The USD increased even if the United States Import Prices increased only by 0.1%, less versus the 0.4% estimate and compared to the 0.8% growth in the former reading period. The Final Wholesale Inventories have increased by 0.8%, beating the 0.7% estimate and the 0.7% growth in the former reading period.

The currency pair increased and has jumped above the 1.2460 static resistance and above the median line (ml) of the minor red ascending pitchfork. A valid breakout above the mentioned broken resistance levels will confirm an increase at least till the median line (ml) of the blue descending pitchfork. It could be attracted by the median line (ML) of the major red descending pitchfork.

Right now is hard to believe that we’ll have a larger rebound as long as the USDX is trapped below some important resistance levels. The USD needs more support from the United States data to be able to dominate the currency market. We could think at a larger rebound only if the rate will come back to retest the broken resistance levels.