- A combination of factors prompted some fresh selling around USD/CAD on Wednesday.
- The risk-on mood dented the greenback’s relative safe-haven demand ahead of FOMC.
- A strong rally in oil prices underpinned the loonie and contributed to the intraday slide.
The USD/CAD pair remained depressed through the early European session and was last seen hovering near daily lows, around the 1.3165-60 region.
The pair continued with its struggle to find acceptance/build on the momentum beyond the 1.3200 mark and witnessed a modest intraday pullback from the top end of a one-week-old trading range. The downtick was sponsored by a combination of factors – the prevalent selling bias around the US dollar and a strong pickup in crude oil prices.
The global risk sentiment remained well supported by the latest optimism over a potential vaccine for the highly contagious coronavirus disease. This coupled with expectations of a dovish Fed further weighed on the greenback and contributed towards capping gains for the USD/CAD pair, instead prompted some selling at higher levels.
Apart from the USD weakness, a strong intraday rally in crude oil prices underpinned the commodity-linked currency – the loonie – and contributed to the intraday slide. The downside, however, is likely to remain limited as investors might refrain from placing aggressive bets ahead of the highly anticipated FOMC monetary policy decision.
Even from a technical perspective, the USD/CAD pair has been oscillating in a range over the past one week or so. This further warrants some caution for aggressive traders and positioning for a firm near-term direction.
Heading into the key central bank event, the release of the US Monthly Retail Sales and Canadian consumer inflation figures will be looked upon for some short-term trading opportunities during the early North American session.
Technical levels to watch
|Today last price||1.3157|
|Today Daily Change||-0.0029|
|Today Daily Change %||-0.22|
|Today daily open||1.3186|
|Previous Daily High||1.3202|
|Previous Daily Low||1.3135|
|Previous Weekly High||1.326|
|Previous Weekly Low||1.3053|
|Previous Monthly High||1.3451|
|Previous Monthly Low||1.302|
|Daily Fibonacci 38.2%||1.3177|
|Daily Fibonacci 61.8%||1.3161|
|Daily Pivot Point S1||1.3147|
|Daily Pivot Point S2||1.3107|
|Daily Pivot Point S3||1.3079|
|Daily Pivot Point R1||1.3214|
|Daily Pivot Point R2||1.3242|
|Daily Pivot Point R3||1.3282|
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.