USD/CAD bounces off YTD low towards 1.3250 as Oil Price drops, US Dollar recovers amid sluggish markets

USD/CAD renews intraday high as it recovers from yearly low during Juneteenth holiday-inspired sluggish trading.
Oil Price drops amid fears of less demand from China.
US Dollar justifies hawkish Fed talks, ignores mixed US data to extend Friday’s corrective bounce.
Fed Chair Powell’s Testimony, preliminary PMIs for June appear crucial for clear directions during holiday-shortened week.

Anil Panchal FXStreet

USD/CAD picks up bids to consolidate the recent losses around the yearly low, refreshing the intraday top near 1.3215 amid early Monday. In doing so, the Loonie pair snaps a two-day downtrend while justifying the broad US Dollar recovery, as well as the downbeat prices of Canada’s main export item WTI crude oil, during a sluggish session due to the Juneteenth holiday in the US.

US Dollar Index (DXY) extends the previous day’s corrective bounce off the monthly low amid slightly downbeat sentiment and the hawkish Fed signals, while also ignoring the mixed US data flashed the previous day. With this, the greenback’s gauge versus the six major currency pair sticks to minor gains around 102.35. On the other hand, WTI crude oil sellers attack the $71.00 round figure while printing the first daily loss in seven.

Headlines surrounding multiple banks cutting China’s growth forecasts and fears of heavy Oil inflow from Iran, due to the likely US-Iran deal, appear to weigh on the WTI crude oil prices. The same joins Fed policymakers’ defense of the July rate hike concerns to weigh on the sentiment and the black gold, as well as favor the DXY.

Preliminary readings of the University of Michigan (UoM) Consumer Sentiment Index (CSI) for June improved but the US inflation expectations eased and tamed the US Dollar bulls. Even so, Fed policymakers have been hawkish of late and allowed the DXY to consolidate recent losses amid a sluggish start to another key week. It’s worth noting that the US Dollar Index dropped the most since early January in the last week. However, downbeat US inflation, Retail Sales and Fed’s hawkish pause join the news about the US-China ties to prod the USD/CAD bulls.

It’s worth noting that the S&P500 Futures print mild losses while tracing Wall Street benchmarks whereas the yields remain lackluster, grinding higher of late.

Moving on, an absence of the US traders will restrict the USD/CAD pair’s moves on Monday. However, Fed Chairman Powell’s bi-annual testimony, as well as PMIs for June, will also be important to watch for clear directions. Also important to watch are the latest outcomes of Canadian Industrial Production and Retail Sales.

Technical analysis

Despite the latest corrective bounce, mainly due to the oversold RSI (14) conditions, the USD/CAD remains on the seller’s radar unless crossing the previous support line stretched from November 2022, around 1.3330 by the press time.

Additional important levels

Overview
Today last price	1.3213
Today Daily Change	0.0015
Today Daily Change %	0.11%
Today daily open	1.3198

Trends
Daily SMA20	1.3443
Daily SMA50	1.3469
Daily SMA100	1.3512
Daily SMA200	1.3518

Levels
Previous Daily High	1.3239
Previous Daily Low	1.3178
Previous Weekly High	1.3384
Previous Weekly Low	1.3178
Previous Monthly High	1.3655
Previous Monthly Low	1.3315
Daily Fibonacci 38.2%	1.3201
Daily Fibonacci 61.8%	1.3216
Daily Pivot Point S1	1.3171
Daily Pivot Point S2	1.3143
Daily Pivot Point S3	1.3109
Daily Pivot Point R1	1.3232
Daily Pivot Point R2	1.3267
Daily Pivot Point R3	1.3294

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

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