USD/CAD extends recovery in tandem with DXY
|- DXY hits fresh 5-day tops.
- WTI turns lower in Europe.
- Eyes on BOC Business outlook survey and Fedspeak.
The USD/CAD pair keeps its recovery mode intact well above the 1.24 handle, as weaker oil prices combined with broad-based US dollar rebound continue to remain supportive.
USD/CAD headed to 1.2450
Amid unabated US dollar demand across the board, the USD/CAD pair remains buoyed and looks to extend the recovery towards the 1.2450 barrier. The USD index jumps +0.25% to flirt with five-day tops of 92.03, as markets believe that last month’s selling in the greenback may be overdone.
Meanwhile, fresh selling seen around the US oil, WTI, weighs negatively on the resource-linked Loonie turned negative, which further collaborates to the upside in the spot. WTI trades subdued near $ 61.50, although the losses appear capped amid lower US rigs count numbers.
The pair slumped to the lowest levels since Sept 2017 after the CAD was boosted on the Canadian jobs report, which came in strongly for the second month in a row, far exceeding expectations. “Canadian Unemployment Rate (Dec) was 5.7% vs an expected 6.0%, from a prior of 5.9%. Net Change in Employment (Dec) was 78.6K vs an expected 1.0K, with a previous read of 79.5K,” The FxPro Analyst Team noted.
Markets now look forward to the sentiment on the Wall Street and BOC Business outlook survey for fresh trading impetus while the FOMC member Bostic’s speech will also hog the limelight amid a data-quiet NA session ahead.
USD/CAD Technical View
The immediate support for the pair aligns at 1.2378 (daily low) ahead of 1.2353 (4-month low) and 1.2300 (natural support). On the upside, resistances could be seen at 1.2448/50 (5-DMA/ psychological levels), 1.2510 (10-DMA) and 1.2556 (intermittent tops).
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.