USD/CAD drops to the fresh low since February 2018 amid US dollar weakness, WTI strength

USD/CAD remains pressured around the multi-day low after flashing the heaviest losses in a week.
US dollar extends south-run to two-month bottom as Fed refrains from talking tapering.
WTI tracks S&P 500 Futures amid hopes of further stimulus, vaccine-led recovery.
US GDP becomes the key data, risk catalysts hold the driver’s seat.

Anil Panchal FXStreet

USD/CAD takes offers around the lowest since February 2018, down 0.11% near 1.2300, during early Thursday. In doing so, the Loonie pair cheers the US dollar weakness and mild gains of the WTI oil, Canada’s main export item, amid a quiet day.

The US dollar index (DXY) refreshes a two-month low as Asian traders react to the US Federal Reserve’s (Fed) cautious optimism. The Fed kept benchmark rates and bond-buying unchanged but Chairman Jerome Powel sounds a bit cautious about the economic recovery and recently strong data.

Following the Fed, markets shrugged off reflation fears as the policymakers rejected talking about tapering.

Also, the sustained stimulus and recently upbeat economic momentum due to the jump in the vaccinations in the West offer a helping hand to the WTI prices that earlier cheered softer-than-expected inventory increase.

Amid these plays, US 10-year Treasury yields stay depressed while S&P 500 Futures print 0.42% gains by the press time.

Looking forward, USD/CAD traders should pay close attention to the preliminary readings of US Q1 GDP, expected 6.5% versus 4.3% prior, for fresh direction. However, the risk catalyst shouldn’t be ignored.

Read: US Q1 GDP Preview: Eyes on inflation and FOMC as economic recovery gathers steam

Technical analysis

Unless trading successfully above the previous multi-day low of 1.2365, flashed in March, even the short-term USD/CAD buyers aren’t likely to take the risk of entries.

Additional important levels

Overview
Today last price	1.2302
Today Daily Change	-13 pips
Today Daily Change %	-0.11%
Today daily open	1.2315

Trends
Daily SMA20	1.2516
Daily SMA50	1.2557
Daily SMA100	1.2652
Daily SMA200	1.2914

Levels
Previous Daily High	1.2418
Previous Daily Low	1.231
Previous Weekly High	1.2654
Previous Weekly Low	1.246
Previous Monthly High	1.274
Previous Monthly Low	1.2365
Daily Fibonacci 38.2%	1.2352
Daily Fibonacci 61.8%	1.2377
Daily Pivot Point S1	1.2278
Daily Pivot Point S2	1.224
Daily Pivot Point S3	1.217
Daily Pivot Point R1	1.2386
Daily Pivot Point R2	1.2456
Daily Pivot Point R3	1.2493

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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