USD/CAD refreshes four-year top above 1.3800 as oil bears dominate
|- USD/CAD leaps forward to early-2016 tops while flashing four-day winning streak.
- Oil prices bear the burden of risk aversion, margin increase, ignores geopolitical plays in Iraq.
- The US PPI, coronavirus headlines will be important to watch for near-term direction.
With oil prices declining more than 7%, USD/CAD ignores disappointment from the US fiscal measures as rising to the fresh four-year high of 1.3820 during early Thursday.
WTI drops to $31.10 by the press time as broad risk aversion, as well as news of increasing trade margins on crude future contracts, seem to weigh on the energy benchmark. Also disappointing the black gold traders are increasing oil inventory levels in the US.
On the other hand, US President Donald Trump unveiled details of his much-awaited fiscal measures to confront coronavirus (COVID-19) with tax reliefs and travel restrictions. However, a lack of spending boost got the market’s attention and triggered risk-off.
Following the news, the US 10-year treasury yields dropped further below 0.8% whereas S&P 500 Futures extend losses to the tune of 4.2% by the time of writing.
Looking forward, the US PPI numbers for February, expected to remain unchanged at 1.7%, can offer intermediate clues to the pair traders. However, updates relating to the virus as well as ECB can offer a bit stronger trade directions.
Technical Analysis
Unless declining below May 2019 top surrounding 1.3565, bulls are less likely to stop in their march towards 1.4000 psychological magnet.
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.