USD/CAD slides to 1-week lows, around mid-1.3500s


  • USD/CAD witnessed some follow-through selling for the third straight session on Wednesday.
  • Bullish crude oil prices underpinned the loonie and kept exerting some pressure on the pair.
  • A subdued USD price action failed to lend any support ahead of US macro data, FOMC minutes.

The USD/CAD pair edged lower through the early European session and dropped to one-week lows, around mid-1.3500s in the last hour.

Having repeatedly failed to find acceptance above the 1.3700 round-figure mark, the pair witnessed a turnaround and witnessed some follow-through selling for the third consecutive session on Wednesday. The ongoing slide was sponsored by the prevalent bullish sentiment surrounding crude oil prices, which tend to underpin the commodity-linked currency – the loonie.

Oil prices rose around 2.5% on Wednesday in the wake of the overnight report, which showed crude inventories in the US fell much more than expected. The data indicated an improvement in demand despite the ever-increasing coronavirus cases globally. Oil prices were further supported by a drop in output from OPEC to the lowest level in two decades in June.

On the other hand, the US dollar struggled to attract any safe-haven flows and remained on the defensive through the first half of Wednesday trading action. Concerns about the second wave of COVID-19 infection did little to impress the USD bulls. Even a strong intraday pickup in the US Treasury bond yields also failed to revive the greenback demand.

It will now be interesting to see if the pair is able to find any support at lower levels or the ongoing slide marks the end of the recent recovery move from the vicinity of 1.3300 mark – three-month lows set earlier this month.

Market participants now look forward to the US economic docket, highlighting the release of the ADP report on private-sector employment and ISM Manufacturing PMI. This will be followed by the release of minutes of the latest FOMC policy meeting, which might influence the USD price dynamics and produce some meaningful trading opportunities.

Technical levels to watch

USD/CAD

Overview
Today last price 1.3547
Today Daily Change -0.0028
Today Daily Change % -0.21
Today daily open 1.3575
 
Trends
Daily SMA20 1.3551
Daily SMA50 1.3795
Daily SMA100 1.3802
Daily SMA200 1.3491
 
Levels
Previous Daily High 1.37
Previous Daily Low 1.357
Previous Weekly High 1.3716
Previous Weekly Low 1.3486
Previous Monthly High 1.3802
Previous Monthly Low 1.3316
Daily Fibonacci 38.2% 1.362
Daily Fibonacci 61.8% 1.365
Daily Pivot Point S1 1.3531
Daily Pivot Point S2 1.3486
Daily Pivot Point S3 1.3401
Daily Pivot Point R1 1.366
Daily Pivot Point R2 1.3744
Daily Pivot Point R3 1.3789

 

 

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