USD/CAD stays firmer around 1.3400 as oil price declines, focus on US/Canada employment data


  • USD/CAD picks up bids to extend Friday’s recovery.
  • Comments from Iraqi Official, concerns over Russian oil price cap weigh on the WTI.
  • Covid woes challenge market sentiment and favor bulls even as hopes of Fed’s easy rate tease sellers.
  • Risk catalysts, monthly job numbers from US, Canada will be crucial for the pair traders.

USD/CAD bulls attack the 1.3400 threshold while extending Friday’s corrective bounce during Monday’s Asian session. In doing so, the Loonie pair cheers the market’s risk-off mood, as well as softer prices of WTI crude oil, Canada’s main export item.

WTI crude oil remains pressured around $76.30, down for the third consecutive day, as bears cheer the market’s risk-off mood, as well as price-negative headlines from Iraqi official and relating to the Russian oil price cap.

“The OPEC+ meeting in December will take into account the condition and balance of the market,” Iraq's state news agency quoted Saadoun Mohsen, a senior official at the country's state oil marketer (SOMO), as saying on Saturday. Elsewhere, the talks among the members of the Group of Seven Nations (G7) and the European Union (EU) continue to drag on the Russian oil price cap. As per the latest updates, the $65 per barrel is the sticking point as discussions are likely to resume on Monday.

That said, the prospect of the Fed’s slower pace of interest rate hikes weighed on the US Dollar the previous week.

It’s worth noting that the People’s Bank of China’s (PBOC) cutting of the Reserve Requirement Ratio (RRR) by 25 basis points (bps) effective from December 5 joins the Covid woes to also propel the USD/CAD prices.

China reported an all-time high of COVID-19 daily cases with nearly 40,000 new infections on Saturday. The dragon nation has been using the stringent policy to limit the virus spread but the outcome hasn’t been a positive one so far. On the contrary, a deadly fire in a building was allegedly linked to the virus-linked lockdown measures and resulted in mass protests in Beijing and Shanghai.

Amid these plays, the US Dollar Index (DXY) stays defensive around 106.30 while the US stock futures and US Treasury yields pare recent losses.

Moving on, the second-tier US data relating to employment may entertain the USD/CAD traders but major attention should be given to the aforementioned risk catalysts and the November month’s job report for the US and Canada.

Technical analysis

A two-week-old symmetrical triangle restricts short-term USD/CAD moves between 1.3430 and 1.3340.

Additional important levels

Overview
Today last price 1.3395
Today Daily Change 0.0025
Today Daily Change % 0.19%
Today daily open 1.337
 
Trends
Daily SMA20 1.3438
Daily SMA50 1.3569
Daily SMA100 1.3271
Daily SMA200 1.3011
 
Levels
Previous Daily High 1.3398
Previous Daily Low 1.3317
Previous Weekly High 1.3495
Previous Weekly Low 1.3316
Previous Monthly High 1.3978
Previous Monthly Low 1.3496
Daily Fibonacci 38.2% 1.3367
Daily Fibonacci 61.8% 1.3348
Daily Pivot Point S1 1.3325
Daily Pivot Point S2 1.328
Daily Pivot Point S3 1.3244
Daily Pivot Point R1 1.3406
Daily Pivot Point R2 1.3443
Daily Pivot Point R3 1.3488

 

 

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