The rate increased significantly today and has resumed the yesterday’s bullish candle. Is to soon to talk about a larger upside movement as the rate is trading below some very important resistance levels. Price has managed to stay above some crucial support levels.

The USD has managed to recover versus the Loonie as the USDX has managed to jump much higher and to reach new highs. A USDX’s further increase will force the USD/ CAD to increase further.

The dollar index could be attracted by a dynamic resistance, that’s why we can think that the USD could dominate the currency market.

The Loonie dropped today also because the Canadian inflation data have failed to impress. The CPI rose by 0.3% as expected, matching the 0.3% growth in the former reading period, while the Core CPI surged by 0.1%, less versus a 0.2% growth in the former reading period.

The Retail Sales have increased by 0.6%, beating the 0.3% estimate and the 0.5% growth in the former reading period, but the Core retail Sales have dropped by 0.2%, even if the traders have expected to see a 0.5% growth.

You should stay away for now because the next days are crucial. We need a confirmation that the rate will increase further in the upcoming period.

The rate has rallied and has erased the Wednesday’s drop. It has climbed above the upper median line (uml) of the ascending pitchfork and could climb towards the outside sliding parallel line (SL) of the descending pitchfork.

Only a valid breakout above the sliding line (SL) will confirm a larger upside movement in the upcoming weeks. The false breakdown below the UML has signaled that the bulls are very strong and could push the rate towards fresh new highs. We’ll have a buying opportunity from above the SL if the rate will make a consolidation.