USD/CAD sticks to gains near session tops, remains below 1.2700 mark


  • USD/CAD staged a modest recovery from one-week lows amid renewed USD buying interest.
  • A more hawkish Fed, surging US bond yields, the cautious mood benefitted the safe-haven USD.
  • Bullish crude oil prices underpinned the loonie and kept a lid on any further gains for the pair.

The USD/CAD pair maintained its bid tone through the first half of the European session, albeit lacked any follow-through buying. The pair was last seen trading around the 1.2680-50 region, up nearly 0.25% for the day.

The pair managed to gain some positive traction on Friday and recovered a part of the overnight slump to one-week lows amid a modest pickup in the US dollar demand. However, bullish crude oil prices continued underpinning the commodity-linked loonie and kept a lid on any meaningful gains for the USD/CAD pair, at least for now.

Uncertainty about potential risks from the debt crisis at China Evergrande Group dampened investors' appetite for perceived riskier assets and triggered a modest pullback in the equity markets. This, along with prospects for an earlier Fed rate hike move and surging US Treasury bond yields, acted as a tailwind for the safe-haven USD.

It is worth recalling that the Fed on Wednesday indicated that it will likely begin rolling back the massive pandemic-era stimulus toward the end of this year and complete the process by mid-2022. Adding to this, the so-called dot plot revealed a growing inclination among policymakers to raise interest rates in 2022.

The repricing of the likely timing of the monetary policy tightening by the Fed continued pushing the US Treasury bond yields higher. In fact, the yield on the benchmark 10-year government bond shot back above the 1.4% threshold for the first time since July on Thursday and further extended some support to the greenback.

Meanwhile, the supporting factor, to a larger extend, was offset the recent run-up in crude oil prices, back closer to July swing highs. The USD/CAD pair, so far, has struggled to reclaim the 1.2700 mark. Traders now look forward to the Fed Chair Jerome Powell's scheduled speech for some impetus later during the early North American session.

Technical levels to watch

USD/CAD

Overview
Today last price 1.2683
Today Daily Change 0.0027
Today Daily Change % 0.21
Today daily open 1.2656
 
Trends
Daily SMA20 1.2663
Daily SMA50 1.2618
Daily SMA100 1.2426
Daily SMA200 1.2525
 
Levels
Previous Daily High 1.2796
Previous Daily Low 1.2634
Previous Weekly High 1.2774
Previous Weekly Low 1.2601
Previous Monthly High 1.2949
Previous Monthly Low 1.2453
Daily Fibonacci 38.2% 1.2696
Daily Fibonacci 61.8% 1.2734
Daily Pivot Point S1 1.2594
Daily Pivot Point S2 1.2533
Daily Pivot Point S3 1.2432
Daily Pivot Point R1 1.2757
Daily Pivot Point R2 1.2858
Daily Pivot Point R3 1.2919

 

 

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. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news

Latest Forex News


Latest Forex News

Editors’ Picks

EUR/USD: A mixed technical picture leaning with slight bearish bias

EUR/USD is a mixed picture across the weekly, daily and 4-hour time frames. The following is a top-down analysis that arrives at both a bear and bullish conclusion depending on the time frames. Overall, the bias leans to the downside, however. 

EUR/USD News

GBP/USD stays range-bound near 1.3750, closer to monthly support

GBP/USD remains on the back foot around 1.3765, keeping the weekly trading range during Wednesday’s Asian session. The cable pair inches closer to an ascending support line from September 29. Given the sluggish Momentum and the quote’s latest break below the 50-SMA, the sellers are sneaking in for entries. 

GBP/USD News

Gold: $1,830's remain elusive, but bull momentum intact

The price of gold has been offered on Tuesday, but it was established in the New York sessions and has found an equilibrium near the 10-day EMA in the current range. XAU/USD is sat in the $1,790s in a quiet start to the Asian session. 

Gold News

Litecoin favors a 20% upswing while LTC bulls remain elusive

Litecoin price has entered a tight congestion zone since the initial spike above the Cloud on October 20th. The trading range has been limited to the Tenkan-Sen at $196 above and Senkou Span B at $188 below. 

Read more

Bank of Canada Rate Decision: Inflation prospects headline policy review Premium

The Bank of Canada is expected to continue tapering its asset purchases and maintain its current rate posture when it concludes it meeting on Wednesday at 10:00 am EDT. Overnight rate projected to be unchanged at 0.25%.

Read more

Forex MAJORS

Cryptocurrencies

Signatures