Several factors can be identified that pushed the price increase to occur on the USD/CAD currency pair chart at the end of this week.
First is the strengthening of the US dollar currency after investors increasingly see indications for the Federal Reserve (Fed) to maintain monetary policy tightening based on published data and the views of central bank members.
The latest United States (US) producer price index data published in the New York session yesterday showed strong figures compared to expectations.
This situation also affects the fall in global crude oil prices where supply demand may be expected to be affected.
Because of this, the effect of falling oil prices has had the effect of depreciating the value of the Canadian dollar because crude oil is Canada's main export.
Thus, the strengthening of the greenback and the depreciation of the Loonie has pushed the bullish pattern displayed on the USD/CAD chart.
If observed, the price last Tuesday tested the support zone at 1.33000 before starting to display a rising pattern until the end of the week.
After reaching a high of 1.34800 in the New York session yesterday, the increase continued today (Friday) and has reached the level of 1.35000 as of the New York session trading.
Reaching that resistance zone also marked a recent 4-week high.
The trend remains bullish where the price is still moving above the support level of the Moving Average 50 (MA50) on the 1-hour time frame on the USD/CAD chart.
The increase will continue if it passes the level of 1.35000 and then records the latest height with a target towards around 1.36500.
However, if the price bounces back down from the 1.3500 zone, the price is seen to drop past the 1.34000 level before heading back to the 1.33000 support zone.
