- USD/CAD benefits from dollar gains and WTI weakness.
- Tepid risk tone will continue to favor the USD bulls.
- CAD traders eye EIA data and broad sentiment for fresh cues.
As the US dollar continues to draw the haven bids from the tepid risk sentiment, USD/CAD keeps its bullish momentum intact above 1.3600.
The spot fades a spike to daily highs of 1.3624, now posting small gains to trade at 1.3609. The continued surge in coronavirus cases globally, with the worsening situation in the US and Australia, boosts the demand for the safe-haven US dollar at the expense of the higher-yielding assets such as stocks, oil, Canadian dollar etc.
Further, the localized lockdowns pour cold water on the narrative of a quicker economic rebound and the optimism over the additional US stimulus talks.
Meanwhile, the Canadian dollar stays on the back foot, mainly due to the renewed weakness in oil prices following a build in the US API crude stockpiles. Also, diminishing odds of a recovery in the oil demand growth this year weighed negatively on the black gold. WTI, currently, sheds 0.52% to trade below 40.50 levels.
Looking ahead, the cautious market mood will continue to favor the US dollar bulls, which could limit any pullback in USD/CAD. The focus also remains on the US EIA crude stocks data for fresh oil-price direction, eventually impacting the resource-linked loonie.
USD/CAD technical levels
“Upbeat RSI conditions and MACD adds to the bullish sentiment that signals a break of 1.3625 mark comprising the said resistance line. However, June 26 top near 1.3715 might question the bulls afterward. On the flip side, the 200-day SMA level of 1.3500 holds the key to the pair’s south-run towards 1.3430,” explains FXStreet’s Analyst Anil Panchal notes.
USD/CAD additional levels
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 edges lower toward 1.0700 post-US PCE
EUR/USD stays under modest bearish pressure but manages to hold above 1.0700 in the American session on Friday. The US Dollar (USD) gathers strength against its rivals after the stronger-than-forecast PCE inflation data, not allowing the pair to gain traction.
GBP/USD retreats to 1.2500 on renewed USD strength
GBP/USD lost its traction and turned negative on the day near 1.2500. Following the stronger-than-expected PCE inflation readings from the US, the USD stays resilient and makes it difficult for the pair to gather recovery momentum.
Gold struggles to hold above $2,350 following US inflation
Gold turned south and declined toward $2,340, erasing a large portion of its daily gains, as the USD benefited from PCE inflation data. The benchmark 10-year US yield, however, stays in negative territory and helps XAU/USD limit its losses.
Bitcoin Weekly Forecast: BTC’s next breakout could propel it to $80,000 Premium
Bitcoin’s recent price consolidation could be nearing its end as technical indicators and on-chain metrics suggest a potential upward breakout. However, this move would not be straightforward and could punish impatient investors.
Week ahead – Hawkish risk as Fed and NFP on tap, Eurozone data eyed too
Fed meets on Wednesday as US inflation stays elevated. Will Friday’s jobs report bring relief or more angst for the markets? Eurozone flash GDP and CPI numbers in focus for the Euro.