USD/CAD keeps falling, 1.300 back on the radar

Pablo Piovano FXStreet

The Canadian Dollar has erased its initial gains vs. its American neighbour today, with USD/CAD now hovering over the 1.3040 region, flat for the day so far.

USD/CAD focus on oil, US data

The broad-based bearish note around the pair stays unchanged so far this week, which is now extending the downside for the fourth consecutive session and approaching at the same time the psychological support at 1.3000 the figure.

The ongoing moderate recovery in crude oil prices has lifted the West Texas Intermediate to the boundaries of the $45.00 mark per barrel, up from last week’s multi-month lows just above the $42.00 handle, and has been lending extra support to CAD.

Furthermore, the recent shift in the BoC’s message to a more hawkish tone (as per comments by Wilkins and Poloz) have been the main force propelling CAD to current levels, gaining nearly 6% since YTD tops near 1.38 seen in May to current levels in the vicinity of the 1.30 handle.

In the data space today, the final print for Q1 GDP and the usual weekly report on the labour market are due in the US docket ahead of the speech by St. Louis Fed J.Bullard (2019 voter, centrist).

USD/CAD significant levels

As of writing the pair is retreating 0.08% at 1.3028 and a break below 1.3007 (low Feb.16) would open the door to 1.2967 (2017 low Jan.31) and finally 1.2818 (low Sep. On the other hand, the next up barrier is located at 1.3203 (10-day sma) seconded by 1.3341 (200-day sma) and then 1.3349 (high Jun.21).

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

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