The USD/CAD increased and resumed the bullish movement. It has increased even if the USDX has dropped since yesterday. The currency pair moves sideways on the short term, but we may have a breakout very soon and the rate could increase further. I’ve said in the last week that the rate should increase further on the short term because is still located in the buyer’s territory.

A USDX further increase will force the USD/CAD to climb towards fresh new highs. Remains to see what will happen in the upcoming hours because we may have a minor drop so the rate to retest a broken dynamic resistance (resistance should turn into support) before will hit fresh new highs.

The USD received support from the United States figures which have impressed earlier. The Building Permits were reported at 1.30M in the previous month, much above the 1.27M estimate, while the Current Account increased unexpectedly in the third quarter, from -124M to -101B estimate, has come in better versus the -116M estimate. Moreover, the Housing Starts increased from 1.26M to 1.30M, beating the 1.25M estimate, the indicator has reached the highest level since November 2016.

You can see that the rate has  rallied after the yesterday’s indecision and was almost to reach the 1.2916 previous high. A breakout above the mentioned high will confirm a further increase in the upcoming period. The next upside target will be at the 1.3047 static resistance, it could be attracted by the upper median line (UML) of the major descending pitchfork and by the upper median line (uml) of the minor descending pitchfork. I’ve said in the last article that the rate should increase further if it will make a valid breakout above the sliding line (SL) of the major descending pitchfork. Another significant drop is less likely to happen right now, only a breakdown below the sliding line (sl) of the blue descending pitchfork will signal a potential breakdown below the ML.