|

USD/CAD keeps bounce off weekly low near 1.2950 amid softer oil prices, US PMI eyed

  • USD/CAD picks up bids to defend the previous day’s rebound from one-week low.
  • WTI crude oil remains pressured around monthly low amid chatters over gas tax holiday.
  • Bulls stay hopeful amid market’s anxiety, Fed Chair Powell’s defense to the biggest rate hike since 1994.

USD/CAD refreshes intraday high around 1.2960 during the initial Asian session on Thursday, extending the rebound from the weekly low. In doing so, the Loonie pair takes clues from softer oil prices, as well as the US dollar’s reluctance to decline further, amid a quiet session.

WTI crude oil prices dropped 0.85% to $103.50, down for the second consecutive day around the lowest levels in six weeks. The black gold’s latest weakness could be linked to the bearish weekly inventory data from the American Petroleum Institute (API). As per the API Weekly Crude Oil Stock for the period ended on Jun 17, stockpiles rose 5.607 million barrels versus an increase of 0.736 million barrels the previous week. Additionally, talks that US President Joe Biden will announce gas tax relief by the end of the week also weighed on the oil prices.

It should be noted that the market’s indecision following the Fed Chair Jerome Powell’s Testimony and the fears of recession, as well as aggressive monetary policy actions, also propel the USD/CAD prices.

Federal Reserve (Fed) Chairman Jerome Powell’s justification for the recent rate hike, the biggest since 1994, managed to gain acceptance, at least during the first round of the Testimony on the bi-annual Monetary Policy Report. However, Powell’s rejection of the need for a heavy rate increase seemed to exert downside pressure on the greenback afterward.

While portraying the mood, Wall Street managed to pare the day-start losses but ended Wednesday with mild losses whereas the US 10-year Treasury yields marked the biggest daily fall in a week by ending the day at around 3.16%. That said, the S&P 500 Futures print mild losses by the press time.

Talking about data, Canada’s headline Consumer Price Index (CPI) rose to 7.7% YoY versus 7.4% expected and 6.8% prior. The more observed inflation figure, namely the Bank of Canada CPI Core, rose 6.1% YoY compared to 5.9% market consensus and 5.7% previous readings.

Moving on, the US S&P Global PMIs for June will entertain the USD/CAD traders along with the weekly US Jobless Claims and the second round of Fed Chair Jerome Powell’s Testimony.

Technical analysis

10-DMA puts a floor under short-term USD/CAD declines around 1.2930. However, the double tops around 1.3075-80 appear a tough nut to crack for the bulls.

Additional important levels

Overview
Today last price1.2959
Today Daily Change0.0034
Today Daily Change %0.26%
Today daily open1.2925
 
Trends
Daily SMA201.2761
Daily SMA501.2781
Daily SMA1001.2722
Daily SMA2001.2674
 
Levels
Previous Daily High1.2988
Previous Daily Low1.2906
Previous Weekly High1.3079
Previous Weekly Low1.2774
Previous Monthly High1.3077
Previous Monthly Low1.2629
Daily Fibonacci 38.2%1.2937
Daily Fibonacci 61.8%1.2956
Daily Pivot Point S11.2891
Daily Pivot Point S21.2858
Daily Pivot Point S31.281
Daily Pivot Point R11.2973
Daily Pivot Point R21.3021
Daily Pivot Point R31.3055

Author

Anil Panchal

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.

More from Anil Panchal
Share:

Editor's Picks

AUD/USD rises to 0.6950 as USD slips on Fed's Warsh

AUD/USD regains traction and extends the bounce toward 0.6950 in the Asian session on Friday. Fed Chair Warsh's comments reinforce the selling pressure on the US Dollar, allowing the pair to stretch higher. Warsh said that he remains committed to delivering price stability without giving away anything on future interest rate path.

USD/JPY falls in symc with USD, gives up 158.00 after Warsh's speech

USD/JPY has come under fresh selling pressure and gives up 158.00 in the Asian session on Friday amid the emergence of fresh US Dollar selling. Fed Chair Warsh's non-committal commentary on the future tightening path, weighs on the US Dollar and the pair.

Gold looks vacillating above $4,150

Gold alternates gains with losses below the key $4,200 mark per troy ounce on Friday. The yellow metal’s irresolute price action comes in response to a modest pullback in the US Dollar and a tepid recovery in US Treasury yields across the board.

Bitcoin steadies at $82,000: The five forces crushing the Uptober rally

Crypto markets have remained under pressure so far in October, with Bitcoin (BTC) sliding below $80,000 earlier this week before recovering to around $82,000 on Friday, as macroeconomic headwinds and cooling demand weigh on the market.

The Fed just got a second hot inflation number. Here's what the diesel signal is really saying
The Federal Reserve (Fed) faces a renewed inflation challenge after two consecutive reports showed price pressure intensifying across the US economy. September's Consumer Price Index (CPI) confirmed accelerating consumer inflation, while the Producer Price Index (PPI) revealed an even sharper rise in business costs. Behind both reports lies a common factor: energy prices.
Everyone's dumping Gold after hot US inflation. Here's why $4,100 could be a floor, not a cliff
Gold (XAU/USD) is recovering from a sharp sell-off triggered by hotter-than-expected United States (US) inflation data released on Wednesday. The precious metal briefly plunged toward $4,073 as investors increased their bets on further Federal Reserve (Fed) interest rate hikes before recovering as US Treasury yields and the US Dollar (USD) reversed their initial gains.