- USD/CAD is sold-off heavily into the US dollar’s weakness amid easing T-yields.
- Surging WTI prices keep the downside momentum intact in the major.
- The pair eyes daily close below 200-DMA to unleash additional declines.
USD/CAD is struggling to extend the rebound from near two-month lows of 1.2451 in the American session, as the relentless rise in WTI prices continues to undermine the sentiment around the major.
Despite the latest downtick, the Canadian dollar preserves most of the daily advance, as oil prices continue to ride higher on escalating geopolitical tensions, with the US imposing sanctions on four Ukrainian officials it accused of destabilizing the latter, as America is trying hard to dissuade Russia from invading Ukraine.
Meanwhile, the black gold shrugged off a build in the US weekly crude stockpiles to the tune of 515K, according to the data published by Energy Information Administration on Thursday. The risk-on market profile aids the rally in the higher-yielding oil, adding credence to the bullish momentum around the resource-linked loonie.
On the US dollar-side of the equation, the pullback in the Treasury yields from two-year highs kept the greenback pressured, in turn, rendering negative for the spot. The correction in the US rates comes after it rallied hard earlier this week on aggressive Fed rate hike expectations.
Technically, USD/CAD remains vulnerable while below the critical horizontal 200-Daily Moving Average (DMA) at 1.2501.
That said, the recent range lows near 1.2450 appear at risk, as the 14-day Relative Strength Index (RSI) points north below the midline.
Meanwhile, the bear cross remains in play after the 21-DMA breached the 50-DMA from above on Tuesday.
A fresh downswing, if triggered, could expose the round level of 1.2400 while any meaningful recovery will need acceptance above the 200-DMA on a daily closing basis.
USD/CAD: Daily chart
USD/CAD: Additional levels to consider
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD fluctuates in daily range above 1.0600
EUR/USD struggles to gather directional momentum and continues to fluctuate above 1.0600 on Tuesday. The modest improvement seen in risk mood limits the US Dollar's gains as investors await Fed Chairman Jerome Powell's speech.
GBP/USD stabilizes near 1.2450 ahead of Powell speech
GBP/USD holds steady at around 1.2450 after recovering from the multi-month low it touched near 1.2400 in the European morning. The USD struggles to gather strength after disappointing housing data. Market focus shifts to Fed Chairman Powell's appearance.
Gold aiming to re-conquer the $2,400 level
Gold stages a correction on Tuesday and fluctuates in negative territory near $2,370 following Monday's upsurge. The benchmark 10-year US Treasury bond yield continues to push higher above 4.6% and makes it difficult for XAU/USD to gain traction.
XRP struggles below $0.50 resistance as SEC vs. Ripple lawsuit likely to enter final pretrial conference
XRP is struggling with resistance at $0.50 as Ripple and the US Securities and Exchange Commission (SEC) are gearing up for the final pretrial conference on Tuesday at a New York court.
US outperformance continues
The economic divergence between the US and the rest of the world has become increasingly pronounced. The latest US inflation prints highlight that underlying inflation pressures seemingly remain stickier than in most other parts of the world.