USD/CAD pokes weekly top above 1.2500 amid US dollar rebound

  • USD/CAD picks up bids to refresh intraday high, rejects Wednesday’s pullback moves.
  • DXY regains upside momentum, shrugs off Powell’s push for easy money.
  • WTI weakness, risk-off mood also favor the bulls.
  • Canadian ADP Employment Change, Powell’s Testimony  2.0 and second-tier US data will be crucial for near-term direction.

USD/CAD advances to 1.2530, up 0.18% on a day, as bulls ignore the previous day’s pullback amid early Thursday.

The loonie pair probed a two-day uptrend on Wednesday after the Bank of Canada (BOC) stayed on the tapering path. However, a weaker than expected reduction in the bond purchase and sustained weakness in Canada’s key export item oil recall the pair buyers afterward.

The up-moves could also be attributed to the US dollar’s pick-up, backed by the downbeat market sentiment. That said, the US dollar index (DXY) consolidates the heaviest gains in a week around 92.40, up 0.05% intraday, by the press time.

It’s worth noting that the USD recovery exerts additional downside pressure on WTI oil prices that already drop for the second consecutive day on the Saudi-UAE deal.

Also weighing on the commodity prices and putting a safe-haven bid under the US dollar could be the coronavirus (COVID-19) woes in the West. The UK, unfortunately, refreshed the six-month high of the daily infections the previous day whereas Indonesia marked record top new cases on Wednesday. Further, Australia’s covid conditions are also grim and have already extended local lockdowns.

Against this backdrop, S&P 500 Futures drop 0.20% intraday whereas the US 10-year Treasury yields print decline two basis points (bps) to 1.33% by the time of the press.

Moving on, Canadian ADP Employment Change for June, prior 101.6K, should be read along with Fed Chair Powell’s second round of testimony, as well as covid updates, for fresh direction. Given the market’s lack of belief in the Fed’s sustained push for easy money and the BOC’s cautious remarks, not to forget WTI weakness, USD/CAD may remain on the front foot.

Technical analysis

Unless breaking a confluence of 100-DMA and an ascending support line from early June, around 1.2380-70, USD/CAD bears are less likely to seek fresh entries.

Additional important levels

Today last price 1.2528
Today Daily Change 0.0021
Today Daily Change % 0.17%
Today daily open 1.2507
Daily SMA20 1.2402
Daily SMA50 1.2224
Daily SMA100 1.2375
Daily SMA200 1.2633
Previous Daily High 1.2526
Previous Daily Low 1.2427
Previous Weekly High 1.259
Previous Weekly Low 1.2303
Previous Monthly High 1.2487
Previous Monthly Low 1.2007
Daily Fibonacci 38.2% 1.2465
Daily Fibonacci 61.8% 1.2488
Daily Pivot Point S1 1.2447
Daily Pivot Point S2 1.2387
Daily Pivot Point S3 1.2347
Daily Pivot Point R1 1.2547
Daily Pivot Point R2 1.2587
Daily Pivot Point R3 1.2647



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