USD/CAD Exchange Rate Prediction – The Dollar Breaks Out as Momentum Rises
The dollar broke out on Thursday following the Labor Department claims data and following Wednesday’s meeting minutes that showed the Fed is considering a date to begin contracting its bond purchase program. Federal Reserve officials at their July gathering made plans to pull back the pace of their monthly bond purchases likely before the end of the year.
The dollar broke out on Thursday, surging above trend line resistance. Target resistance is now seen near the February highs at 1.2864. Support is the former breakout level near 1.2735. Medium,-term momentum is positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. This buy signal occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses above the MACD signal line (the 9-day moving average of the MACD line.