USD/CAD struggles around 1.3440 as WTI gains confront trade pessimism


  • US-Iran tension and likely absence of metal tariffs to Canada please the CAD bulls.
  • Doubts over the US-China trade deal continue challenging the pair’s upside.

With the US-China trade tensions questioning the rise in crude oil prices, the USD/CAD pair struggles around 1.3440 ahead of the European open on Thursday.

Despite witnessing more than expected reading of the weekly US crude oil stock, the energy benchmark stretched its latest recovery forward as tensions between the US and Iran dominate.

The US recently called off its non-emergency staff from Iraq smelling an attack from Iran. However, Iran’s foreign minister stated that the nation remains committed to the nuclear deal, which in turn turned some pessimism off the mark.

Weighing on the Canadian Dollar (CAD) is the present uncertainty over the US-China trade relations. The US President recently announced executive order barring foreign companies from telecommunication sector on a national security basis. The same is likely to adversely affect Chinese giant Huawei and may create further divide amid the world’s two largest economies.

It should also be noted that the US is in talks with Canada to help it avoid fresh tariffs on metals.

Looking forward, speech from the Bank of Canada’s (BOC) Governor Stephen Poloz, Canadian manufacturing sales and second-tier details of housing and manufacturing from the US are likely to entertain momentum traders for rest of the day.

Technical Analysis

A 50-day simple moving average (SMA) near 1.3390 and an upward sloping trend-line since late-February at 1.3360 seem crucial downside supports for the pair that holds the gate for its downturn to 1.3340 comprising 100-day SMA.

Alternatively, 1.3500 and the four-month-old ascending trend-line, at 1.3550, may limit the immediate upside of the pair ahead of highlighting 1.3565, 1.3620 and December 2018 highs near 1.3665.

Share: Feed news

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.

Recommended content


Recommended content

Editors’ Picks

EUR/USD consolidates weekly gains above 1.1150

EUR/USD consolidates weekly gains above 1.1150

EUR/USD moves up and down in a narrow channel slightly above 1.1150 on Friday. In the absence of high-tier macroeconomic data releases, comments from central bank officials and the risk mood could drive the pair's action heading into the weekend.

EUR/USD News
GBP/USD stabilizes near 1.3300, looks to post strong weekly gains

GBP/USD stabilizes near 1.3300, looks to post strong weekly gains

GBP/USD trades modestly higher on the day near 1.3300, supported by the upbeat UK Retail Sales data for August. The pair remains on track to end the week, which featured Fed and BoE policy decisions, with strong gains. 

GBP/USD News
Gold extends rally to new record-high above $2,610

Gold extends rally to new record-high above $2,610

Gold (XAU/USD) preserves its bullish momentum and trades at a new all-time high above $2,610 on Friday. Heightened expectations that global central banks will follow the Fed in easing policy and slashing rates lift XAU/USD.

Gold News
Week ahead – SNB to cut again, RBA to stand pat, PCE inflation also on tap

Week ahead – SNB to cut again, RBA to stand pat, PCE inflation also on tap

SNB is expected to ease for third time; might cut by 50bps. RBA to hold rates but could turn less hawkish as CPI falls. After inaugural Fed cut, attention turns to PCE inflation.

Read more
Bank of Japan set to keep rates on hold after July’s hike shocked markets

Bank of Japan set to keep rates on hold after July’s hike shocked markets

The Bank of Japan is expected to keep its short-term interest rate target between 0.15% and 0.25% on Friday, following the conclusion of its two-day monetary policy review. The decision is set to be announced during the early Asian session. 

Read more
Moneta Markets review 2024: All you need to know

Moneta Markets review 2024: All you need to know

VERIFIED In this review, the FXStreet team provides an independent and thorough analysis based on direct testing and real experiences with Moneta Markets – an excellent broker for novice to intermediate forex traders who want to broaden their knowledge base.

Read More

Forex MAJORS

Cryptocurrencies

Signatures