USD/CAD drops to fresh multi-year lows below 1.2650

USD/CAD is falling for the second straight day on Wednesday.
WTI trades in the positive territory above $50.
USD selloff remains intact ahead of US data, FOMC Minutes.

Eren Sengezer FXStreet

The USD/CAD pair closed in the positive territory on Tuesday as surging crude oil prices helped the CAD outperform its rivals. With the oil rally remaining intact and the greenback struggling to find demand, the pair extended its slide and touched its lowest level since April 2018 at 1.2638. As of writing, the pair was down 0.2% on the day at 1.2644.

Focus shifts to US data, FOMC Minutes

Following the two-day OPEC+ meeting, Saudi Arabia announced on Tuesday that they will be voluntarily cutting their output in February and March, which will amount to 1 million barrels per day. The barrel of West Texas Intermediate (WTI) gained more than 5% and preserved its bullish momentum on Wednesday. At the moment, the WTI is trading at its highest level in more than 10 months, rising 1.44% on the day at $50.52.

On the other hand, the risk-on market environment makes it difficult for the greenback to find demand. In the meantime, the 10-year US Treasury bond yield is up more than 7% on Wednesday as investors price in a Democratic majority in the Senate. If the US T-bond yields continue to push higher, the USD could find some demand. Nevertheless, the US Dollar Index is currently losing 0.2% on the day at 89.26.

Later in the day, the ADP Employment Change, Factory Orders and Markit Services PMI data will be featured in the US economic docket. More importantly, the FOMC will release the December Minutes at 1900 GMT.

Technical levels to watch for

USD/CAD

Overview
Today last price	1.2646
Today Daily Change	-0.0030
Today Daily Change %	-0.24
Today daily open	1.2676

Trends
Daily SMA20	1.2785
Daily SMA50	1.2946
Daily SMA100	1.3072
Daily SMA200	1.3389

Levels
Previous Daily High	1.2792
Previous Daily Low	1.2656
Previous Weekly High	1.2876
Previous Weekly Low	1.2714
Previous Monthly High	1.301
Previous Monthly Low	1.2688
Daily Fibonacci 38.2%	1.2708
Daily Fibonacci 61.8%	1.274
Daily Pivot Point S1	1.2624
Daily Pivot Point S2	1.2572
Daily Pivot Point S3	1.2489
Daily Pivot Point R1	1.2759
Daily Pivot Point R2	1.2843
Daily Pivot Point R3	1.2895

Author

Eren Sengezer

FXStreet

As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.

USD/JPY eyes August swing low, near 155.20 ahead of US NFP

USD/JPY retests the August monthly swing low during the Asian session on Friday as a more hawkish repricing of BoJ rate-hike bets and a suspected intervention continue to underpin the Japanese Yen. Meanwhile, the US Dollar is seen consolidating the previous day's heavy losses amid soft US bond yields, further weighing on the currency pair as traders keenly await the US NFP report.

AUD/USD consolidates above 0.7200; US NFP awaited

AUD/USD holds steady above 0.7200, near its highest level since mid-May, as bulls await the US NFP report for more cues on the Fed's policy path before placing fresh bets. Meanwhile, the recent decline in US bond yields keeps the US Dollar depressed near its lowest level in over a week and acts as a tailwind for the Aussie amid the RBA's hawkish tilt.

Gold tumbles as blockbuster US NFP lift US Dollar, Treasury yields

Gold (XAU/USD) falls sharply on Friday, snapping a two-day recovery after the US Nonfarm Payrolls (NFP) report surprised strongly to the upside. The metal briefly climbed above $4,500 on Thursday, gaining nearly 2%, but has since erased a large part of that advance.

Crypto’s $638 million buyback boom may not be as bullish as it looks

Decentralized Finance (DeFi) protocols reportedly spent $638 million to buy back their native tokens in August, up 17% from a year earlier. On the surface, the buyback trend suggests the cryptocurrency industry is maturing fast, adopting one of Wall Street’s oldest tools to bolster valuations and distribute revenue. The headline becomes less impressive once the number is opened up.

Why hawkish Bank of Japan expectations aren't enough to sustain the Japanese Yen rally

The Japanese Yen (JPY) experienced a sudden burst higher after falling back below the 160.00 psychological mark against the US Dollar (USD) earlier this week amid a more hawkish repricing of Bank of Japan (BoJ) rate hike expectations.

Diesel’s record $100 warning: The oil shock hiding in plain sight

The Oil market may look calmer than it did a few months ago, but diesel is sending a very different message. The US diesel crack spread, the premium of ultra-low sulphur diesel futures over WTI, recently surged above $100 per barrel for the first time, reaching an intraday record of just over $102.00.