• A combination of factors assisted USD/CAD to stage a modest bounce from multi-year lows.
  • A pullback in the equity markets benefitted the safe-haven USD and extended some support.
  • Sliding crude oil prices undermined the loonie and remained supportive of the positive move.

The USD/CAD pair edged higher through the early European session and climbed to fresh daily tops, around the 1.2680 region in the last hour.

The pair managed to gain some positive traction on the last trading day of the week and built on the previous day's modest bounce from sub-1.2600 levels, or multi-year lows. A weaker tone surrounding crude oil prices undermined the commodity-linked loonie, which, in turn, was seen driving the USD/CAD pair higher.

Oil retreated further from 11-month highs touched last week and was weighed down by worries that the imposition of lockdown restrictions will curb fuel demand. The black gold was further pressured by data released on Wednesday, showing that US crude oil inventories surprisingly increased by 2.6 million barrels last week.

Apart from this, a modest pullback in the equity markets extended some support to the US dollar and provided an additional boost to the USD/CAD pair. Investors opted to take some profits off the table following the recent strong rally to record highs, which was driven by hopes for a massive US fiscal stimulus measures.

Investors have been pricing in the prospects for more aggressive fiscal spending in 2021 under Joe Biden's presidency. This comes amid the optimism over the rollout of vaccines for the highly contagious coronavirus disease and fueled hopes for a strong global economic recovery, eventually boosting investors' confidence.

Moving ahead, market participants now look forward to Friday's economic docket, highlighting the release of Canadian monthly retail sales data and flash US PMI prints, for a fresh impetus. This, along with the official oil inventory data from the US, should assist investors to grab some meaningful trading opportunities.

Technical levels to watch

USD/CAD

Overview
Today last price 1.2676
Today Daily Change 0.0044
Today Daily Change % 0.35
Today daily open 1.2632
 
Trends
Daily SMA20 1.2728
Daily SMA50 1.2836
Daily SMA100 1.302
Daily SMA200 1.3308
 
Levels
Previous Daily High 1.2648
Previous Daily Low 1.259
Previous Weekly High 1.2836
Previous Weekly Low 1.2625
Previous Monthly High 1.301
Previous Monthly Low 1.2688
Daily Fibonacci 38.2% 1.2612
Daily Fibonacci 61.8% 1.2625
Daily Pivot Point S1 1.2598
Daily Pivot Point S2 1.2565
Daily Pivot Point S3 1.254
Daily Pivot Point R1 1.2656
Daily Pivot Point R2 1.2681
Daily Pivot Point R3 1.2715

 

 

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.

Feed news Join Telegram

Recommended content


Recommended content

Editors’ Picks

EUR/USD: Defensive below 1.0600 amid ECB news, cautious mood

EUR/USD: Defensive below 1.0600 amid ECB news, cautious mood

EUR/USD is under pressure below 1.0600, as the US dollar finds its feet amid a cautious market mood. The euro shrugs off the latest report, citing that the ECB may unveil a new bond-buying scheme to cap yields/spreads in July. ECB-speak, US data awaited. 

EUR/USD News

GBP/USD eases towards 1.2250 as USD attempts a bounce

GBP/USD eases towards 1.2250 as USD attempts a bounce

GBP/USD is falling towards 1.2250, extending a sluggish start to the week. The pair retreats amid a renewed uptick seen in the US dollar, as risk-off sentiment prevails. Recent negative Brexit and UK political news remain a drag on the pound. US data eyed. 

GBP/USD News

Gold: Can bulls defend the critical $1,820 support? Premium

Gold: Can bulls defend the critical $1,820 support?

XAUUSD opened a new week on a positive note but failed to sustain the previous upbeat momentum after running into strong barriers near the $1,842 region. The metal shaved off the early gains and fell nearly $20 from the highest point of the day to settle Monday in the red at $1,823.

Gold News

LUNA 2.0 price is primed for 60% rally

LUNA 2.0 price is primed for 60% rally

LUNA price breached the range it was trading in and crashed violently in June. However, buyers seem to be making a comeback, suggesting that a recovery rally is in effect. The ongoing retracement hints at a 60% upswing to $3.50.

Read more

FXStreet Premium users exceed expectations

FXStreet Premium users exceed expectations

Tap into our 20 years Forex trading experience and get ahead of the markets. Maximize our actionable content, be part of our community, and chat with our experts. Join FXStreet Premium today!

BECOME PREMIUM

Forex MAJORS

Cryptocurrencies

Signatures