USD/CAD rallied today and tries to recover after the last two day’s massive drop. Price is pressuring a very important dynamic resistance, but only a valid breakout will signal a further increase on the short term. We’ll see what will happen in the upcoming days, but it looks determined to increase if the dollar index will have enough energy to close and stabilize above the 93.81 static resistance.

USD/CAD remains in the buyer’s territory despite the aggressive drop. Personally, I believe that it will increase further if will close the day near the 1.2882 today’s high. The rate could reach new highs till the end of the day.

The Loonie has taken a hit from the Canadian Manufacturing Sales, which have dropped by 0.4% in October, even if the traders have expected to see a 0.9% growth. On the other hand, the greenback increases significantly even if the United States data have come in worse than expected.

The Industrial Production increased by 0.2%, less versus the 0.3% estimate and versus the 1.2% growth in the former reading period, the Capacity Utilization Rate was reported at 77.1%, below the 77.2% estimate, while the Empire State Manufacturing Index was reported at 18.0, much below the 18.8 estimate and versus the 19.4 in the former reading period.

Price has managed to erase the last two days drops and seems motivated to reach fresh new highs very soon. A valid breakout above the sliding line (SL) of the major descending pitchfork will confirm a further increase.

The next upside target remains at the 1.3047 level, it could be attracted by the upper median line (UML) of the major red descending pitchfork and by the upper median line (uml) of the blue descending pitchfork.

It is somehow expected to increase after the false breakdown below the sliding line (sl) of the blue descending pitchfork, but as I’ve said, we need a confirmation that it will climb much higher.