USD/CAD Back to 1.30?

USD/CAD Back to 1.30?

USD/CAD Back to 1.30?

We have been trading USD/CAD throughout the day. Although Friday’s employment report and trade balance were significantly weaker than expected and building permits turned lower this morning, the primary driver for CAD is oil. Crude prices rose 2.5% today after OPEC said they would hold informal talks at next month’s energy summit to find ways to stabilize oil prices. Now that $42 a barrel has been reached in a meaningful way, the charts show a potential extension to $44.50, which would be consistent with USD/CAD at 1.3100.

Technically today is the first retrace after Friday’s strong gains. There’s short-term resistance at 1.32 with more significant resistance at the July high of 1.3253. If USD/CAD fails here, it should at minimum test the 20-day SMA near 1.3080 and then make a run for 1.30.

Chart Of The Day

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