USD/CAD is currently residing at the edge of 1.3120 support area from where it is expected to push higher with a target towards 1.34 area in the coming days. USD has been the dominant currency over CAD since the rate hike but recent CAD positive economic reports during the Trade War tension did provide some room for the bears to create certain pullbacks in the process.
USD has been quite positive with the economic reports so far this week, which did not quite help the currency to sustain the bullish momentum it had after breaking above 1.3120 with a daily close earlier. Ahead of the upcoming high impact economic reports to be published on Friday, today there is no impactful economic reports to be published due to Independence Day holiday being observed throughout the nation. But tomorrow, just the day before NFP, ADP Non-Farm Employment Change report is going to be published which is expected to increase to 190k from the previous figure of 178k and Unemployment Claims report is expected to increase to 231k from the previous figure of 227k.
On the CAD side, today there is no impactful economic reports to be published and add to the CAD gains in the process but on Friday alongside the US NFP reports, CAD Employment Change report is going to be published which is expected to increase to 20.3k from the previous figure of -7.5k, Trade Balance is expected to decrease to -2.2B from the previous figure of -1.9B and Unemployment Rate is expected to be unchanged at 5.8%.
As of the current scenario, the pair is expected to be very volatile and corrective till this weekly candle close as high impact economic reports are expected to inject uncertainty in the pair as per Trade War situation is still present. To sum up, USD is expected to have an upper hand over CAD in the process.
Now let us look at the technical view. The price is currently retesting the 1.3120 resistance area as support from where the price is expected to push higher with a target towards 1.3400 area in the future. The price has also formed a Bullish Continuation Divergence in the process which is expected to add further accuracy and momentum for the upcoming bullish pressure in the pair. As the price remains above 1.3120 area with a daily close, the bullish bias is expected to continue.
