USD/CAD advances towards 1.2650 on subdued oil prices, US CPI eyed

USD/CAD is sustaining comfortably above 1.2600 amid falling oil prices.
Additional oil supply at 1.3 million bpd will offset the supply cut by Russia after sanctions on Moscow.
This week BOC ‘s interest rate decision and the US CPI will be the main events to keep on the radar.

Sagar Dua FXStreet

The USD/CAD pair managed to establish above 1.2600 on Monday after multiple failed attempts last week. The asset is advancing sharply towards 1.2650 as subdued oil prices have dented the optimism of the loonie. The major has extended its gains on Tuesday after overstepping Monday’s high at 1.2641.

Oil prices have tumbled around 3% on Monday amid a push of 240 million barrels of oil supply through the collective effort of the US administration and the International Economic Agency (IEA) in the next six months. The market participants will figure out the extent to which the additional oil will offset the prohibited Russian oil after sanctions on the latter.

The release of Strategic Petroleum Reserve (SPR) volumes is equivalent to 1.3 million barrels per day (bpd) over the next six months, which is enough to offset a shortfall of 1 million bpd of Russian oil supply, analysts at JP Morgan said.

Meanwhile, the lockdown curbs in China to contain the Covid-19 have restricted the movement of men, materials, and machines. This has dampened the demand of oil in a country, which carries the tag of the biggest importer of oil.

Canada, being the largest exporter of oil to the US is facing the heat of lesser cash flows amid falling crude prices.

Going forward, investors will focus on the US Consumer Price Index (CPI), which is due on Tuesday. The US inflation is likely to print a fresh multi-decade high at 8.5%. Apart from that, the Bank of Canada (BOC) will dictate its interest rate decision on Wednesday. The BOC is expected to push its interest rates by 50 basis points.

USD/CAD

Overview
Today last price	1.2652
Today Daily Change	0.0020
Today Daily Change %	0.16
Today daily open	1.2632

Trends
Daily SMA20	1.2561
Daily SMA50	1.2665
Daily SMA100	1.269
Daily SMA200	1.2624

Levels
Previous Daily High	1.2641
Previous Daily Low	1.2566
Previous Weekly High	1.2619
Previous Weekly Low	1.2403
Previous Monthly High	1.2901
Previous Monthly Low	1.243
Daily Fibonacci 38.2%	1.2612
Daily Fibonacci 61.8%	1.2595
Daily Pivot Point S1	1.2585
Daily Pivot Point S2	1.2539
Daily Pivot Point S3	1.2511
Daily Pivot Point R1	1.266
Daily Pivot Point R2	1.2688
Daily Pivot Point R3	1.2734

Author

Sagar Dua

FXStreet

Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.

GBP/USD surges to multi-day peaks past 1.3250

GBP/USD leaves behind Friday’s small pullback and advances past 1.3250 level, or five-day highs, on Monday. Cable’s upside follows extra losses in the Greenback, while traders continue to assess the geopolitical front and upcoming key events.

EUR/USD picks up extra pace north of 1.1400

EUR/USD extends its recovery past 1.1400 the figure as the NA session draws to a close on Monday. Indeed, the pair advances for the third straight day amid the persistent offered bias in the US Dollar. Meanwhile, market participants keep gearing up for the ECB Forum in Sintra and the release of critical US labour market data.

Gold struggles to attract investors

Gold remains under marked selling pressure, holding on just above the key $4,000 mark per troy ounce at the beginning of the week. The precious metal reverses two daily advances in a row as renewed effervescence in the Middle East revive inflation concerns and bolster Fed rate hike expectations.

Strategy unveils plan allowing Bitcoin sales to fund stock buybacks, dividends and reserves

Strategy (MSTR) has unveiled a Digital Credit Framework to strengthen the company’s financial standing. Under the new framework, the world’s largest corporate holder of Bitcoin (BTC) will pivot from its previous accumulation strategy, opting to sell BTC in order to boost liquidity, fund dividend payments, execute stock buybacks, and strengthen cash reserves.

Just like Fed, is BoJ’s independence under threat?

When talking about central bank independence, most of the focus has been on Donald Trump’s pressure on the Federal Reserve. But a similar story, a quieter one for now, seems to be happening on the other side of the Pacific: Japan’s government may be testing the Bank of Japan’s independence.

Kevin Warsh isn't expected to say much in Sintra: That's exactly why markets will listen

Financial markets could find an important catalyst in the enchanting, fairytale-like landscape of Sintra this week. The ECB Forum will, as it does every year, gather the crème de la crème of central banks. The new boss at the Fed, who has clearly said that the Fed should stop explaining everything, will need to talk – and traders should listen.