USD/CAD remains steady above 1.2800 amid falling oil prices

The USD/CAD slumps during the New York session, trading at 1.2809 at press time. Investors’ mood is mixed, as US equity indices fluctuate between gainers and losers. In the last couple of weeks, Omicron’s woes eased, as evidence that although it is highly infectious, it leads to milder symptoms, despite breaking the daily record of infections on Tuesday, topping around 1.449 Million worldwide.

In the meantime, the US crude oil benchmark, WTI, retreats from $77.20 monthly highs down to $75.72, a headwind for the commodity-oil-linked Canadian dollar. 

The uptick of the USD/CAD in the last hour is courtesy of the slide in crude oil prices, which caused an uptick of 30-pips in the pair, despite broad US dollar weakness across the board. Further, the US Dollar Index, which measures the greenback’s performance against a basket of six currencies, slides down to 95.98, for a 0.24% loss. 

In the bond market, US long-maturity Treasury yields advance, with the 10s, the 20s, and 30s, overperforming the shot-term of the yield curve, rising to 1.536%, 1.9875%, and 1.953%, respectively.

In the overnight session, the USD/CAD remained subdued within a 1.2800-35 range, dropping towards 1.2788 near the S1 daily pivot, the first line of defense for USD bulls, who entered the market, lifting prices back above the 1.2800 figure.

USD/CAD Price Forecast: Technical outlook

The USD/CAD daily chart portrays the upward bias in the pair. The daily moving averages (DMAs) reside below the spot price. Furthermore, the 50-DMA just crossed above the 100-DMA, leaving the 200-DMA below the aforementioned.

To the upside, the first ceiling level would be the December 27 cycle high at 1.2847. A break above that level would expose the December 22 daily high at 1.2924, immediately followed by the December 20 swing high at 1.2964.