USD/CAD slumps to 1.2500 as USD selloff intensifies

USD/CAD continues to push lower in the American session.
US Dollar Index extends slide toward 91.50 on Wednesday.
WTI rises more than 4%, trades above $63.

Eren Sengezer FXStreet

The USD/CAD pair rose to a daily high of 1.2576 during the European trading hours but reversed its direction in the second half of the day. As of writing, the pair was trading at its lowest level since March 22 at 1.2499, losing 0.24% on a daily basis.

Oil rally, USD selloff drag USD/CAD

The broad-based selling pressure surrounding the greenback continues to weigh on USD/CAD. Despite a modest rebound witnessed in the benchmark 10-year US Treasury bond yield, the US Dollar Index (DXY) extended its slide after breaking below 92.00 and touched its worst level in more than three weeks at 91.57. At the moment, the DXY is losing 0.26% at 91.60.

While speaking at an event organized by the Economic Club of Washington, FOMC Chairman Jerome Powell said the market should focus on the outcomes rather than the last dot plot. Powell further noted that it was likely for the Fed to start tapering the QE before going for a rate hike.

On the other hand, the sharp upsurge witnessed in crude oil prices is providing a boost to the commodity-related loonie. After the data published by the US Energy Information Administration showed that crude oil inventories in the US declined by 5.9 million barrels in the week ending April 9, the barrel of West Texas Intermediate (WTI) shot higher. Currently, WTI is trading at $63.20, rising 4.5% on a daily basis.

Technical levels to watch for

USD/CAD

Overview
Today last price	1.2502
Today Daily Change	-0.0032
Today Daily Change %	-0.26
Today daily open	1.2534

Trends
Daily SMA20	1.2553
Daily SMA50	1.2609
Daily SMA100	1.2699
Daily SMA200	1.2972

Levels
Previous Daily High	1.263
Previous Daily Low	1.2527
Previous Weekly High	1.2635
Previous Weekly Low	1.2502
Previous Monthly High	1.274
Previous Monthly Low	1.2365
Daily Fibonacci 38.2%	1.2566
Daily Fibonacci 61.8%	1.2591
Daily Pivot Point S1	1.2498
Daily Pivot Point S2	1.2461
Daily Pivot Point S3	1.2395
Daily Pivot Point R1	1.26
Daily Pivot Point R2	1.2666
Daily Pivot Point R3	1.2703

Author

Eren Sengezer

FXStreet

As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.

Markets move fast. We move first.

Orange Juice Newsletter brings you expert driven insights - not headlines. Every day on your inbox.

Editor's Picks

EUR/USD falls toward 1.1700 on broad USD recovery

EUR/USD turns south and declines toward 1.1700 on Wednesday. The US Dollar gathers recovery momentum and forces the pair to stay on the back foor, as traders look to USD short-covering ahead of US inflation report on Thursday. However, the downside could be capped by hawkish ECB expectations.

GBP/USD trades deep in red below 1.3350 after soft UK inflation data

GBP/USD stays under strong selling pressure midweek and trades below 1.3350. The UK annual headline and core CPI rose by 3.2% each, missing estimates of 3.5% and 3.4%, respectively, reaffirming dovish BoE expectations and smashing the Pound Sterling across the board ahead of Thurday's BoE policy announcements.

Gold clings to moderate daily gains above $4,300

Following Tuesday's volatile action, Gold regains its traction on Wednesday and trades in positive territory above $4,300. While the buildup in the USD recovery momentum caps XAU/USD's upside, the cautious market stance helps the pair hold its ground.