- USD/CAD once again defends 200-DMA and stages a goodish intraday bounce.
- Worsening US-China relations extended some support to the safe-haven USD.
- Weaker oil prices undermined the loonie and remained supportive of the uptick.
The USD/CAD pair dropped to fresh three-month lows, around the 1.3470-65 region in the last hour, albeit quickly recovered over 60-70 pips thereafter.
The US dollar struggled to preserve its early gains, instead witnessed some aggressive selling on the back of a strong rally in the shared currency post-ECB announcement. Some renewed USD weakness turned out to be one of the key factors that exerted some downward pressure on the USD/CAD pair.
However, a weaker tone around crude oil prices undermined the commodity-linked currency – the loonie – and helped limit the fall. The pair once again attracted some dip-buying near the very important 200-day SMA and was last seen trading near session tops, around the 1.3530 region.
Meanwhile, concerns about a further escalation in tensions between the USD and China extended some support to the greenback's safe-haven status. On the economic data front, the US Initial Weekly Jobless Claims came in higher-than-expected and did little to impress the USD bulls.
From Canada, the monthly trade balance data came in to show a deficit of C$ 3.25 billion for April as compared to C$ 2.36 billion expected and C$ 1.53 billion previous. The economic data failed to provide any meaningful impetus, albeit remained supportive of the bid tone surrounding the USD/CAD pair.
Given that the pair has been showing some resilience near a technically significant moving average, the set-up now supports prospects for some near-term short-covering move. Hence, a move towards the 1.3570-80 supply zone, en-route the 1.3600 mark, now looks a distinct possibility.
Technical levels to watch
|Today last price||1.3522|
|Today Daily Change||0.0026|
|Today Daily Change %||0.19|
|Today daily open||1.3496|
|Previous Daily High||1.3572|
|Previous Daily Low||1.348|
|Previous Weekly High||1.4008|
|Previous Weekly Low||1.3715|
|Previous Monthly High||1.4173|
|Previous Monthly Low||1.3715|
|Daily Fibonacci 38.2%||1.3516|
|Daily Fibonacci 61.8%||1.3537|
|Daily Pivot Point S1||1.346|
|Daily Pivot Point S2||1.3424|
|Daily Pivot Point S3||1.3368|
|Daily Pivot Point R1||1.3552|
|Daily Pivot Point R2||1.3608|
|Daily Pivot Point R3||1.3644|
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