USD/CAD bulls remain in control, eyeing a move towards 100-DMA

Haresh Menghani FXStreet

• The ongoing USD recovery supports the up-move.
• Loonie fails to benefit from positive oil prices.

The USD/CAD pair extended its steady climb through the mid-European session and is now looking to build on the momentum further beyond the 1.2600 handle.

The US Dollar continued with its recovery move from last week’s three-year lows and was further supported by a fresh wave of an upsurge in the US Treasury bond yields and was eventually driving the pair higher.

Meanwhile, a consolidative price action around oil markets, with WTI crude oil holding steady with daily gains of around 0.75%, did little to influence demand for the commodity-linked currency - Loonie. Hence, the USD price dynamics is turning out to be an exclusive driver of the pair's up-move, for the third consecutive session on Tuesday.

From a technical perspective, bulls might now be eyeing for a decisive breakthrough 100-day SMA barrier, currently near the 1.2620-25 region, before positioning for any additional near-term appreciating move.

Technical levels to watch

On a sustained move beyond the mentioned hurdle, the pair seems more likely to surpass an intermediate resistance near the 1.2645-50 region and head towards reclaiming the 1.2700 handle.

Alternatively, a reversal from current resistance zone, leading to a subsequent weakness back below 50-day SMA resistance turned support, near the 1.2555 area, might turn the pair vulnerable to slide further towards the key 1.2500 psychological mark.

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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