USD/CAD struggles below 1.2300 amid upbeat market sentiment, firmer WTI


  • USD/CAD eases inside a 20-pip trading range near February 2018 lows.
  • Upbeat US data, hopes of economic recovery and stimulus back market sentiment.
  • WTI extends Monday’s gains on weaker US dollar, risk-on mood.
  • Canadian trade figures, risk catalysts should be watched for fresh impetus.

USD/CAD eases from an intraday high of 1.2281 to 1.2277, keeping the short-term trading range, amid the initial Asian session trading on Tuesday. In doing so, the Loonie pair struggles for a clear direction near the lowest levels since early 2018.

The quote stayed near the multi-day low, printing mild intraday losses, amid broad US dollar weakness and upbeat prices of Canada’s key export item, namely WTI oil.

The US dollar index (DXY) took a U-turn from a one-week top to print daily losses on Monday as the market’s mood turned positive, dimming the safe-haven demand of the greenback. Behind the optimism were comments from US Federal Reserve Chairman (Fed) Jerome Powell and New York Fed President John Williams.

It should be noted that ongoing US-Iran jitters and tussles between Saudi Arabia and Tehran helped oil, in addition to the strong risk appetite, which in turn favored the USD/CAD prices. Furthermore, headlines suggesting vaccinations for Americans in the 12-15 years age group offered additional support to the risk-on mood.

Even so, weaker than expected Canadian Markit Manufacturing PMI battled the US ISM Manufacturing to test the pair sellers. Also on the negative side were chatters surrounding the West versus China story.

Amid these plays, S&P 500 Futures waver around 4,182 after Wall Street’s mixed closing and downbeat US Treasury yields.

Looking forward, Canada’s Building Permits and trade numbers for March, coupled with the US Factory Orders for the said month, will be the key for USD/CAD traders. However, the headlines concerning the coronavirus (COVID-19) and other risks shouldn’t be ignored as well.

Technical analysis

Contrasting candlestick formations near the multi-day lows require USD/CAD traders to wait for a clear break of 1.2265–2325 area before taking any fresh entries.

Additional important levels

Overview
Today last price 1.2278
Today Daily Change -11 pips
Today Daily Change % -0.09%
Today daily open 1.2289
 
Trends
Daily SMA20 1.2488
Daily SMA50 1.2542
Daily SMA100 1.2643
Daily SMA200 1.2903
 
Levels
Previous Daily High 1.2323
Previous Daily Low 1.2266
Previous Weekly High 1.2491
Previous Weekly Low 1.2266
Previous Monthly High 1.2654
Previous Monthly Low 1.2266
Daily Fibonacci 38.2% 1.2301
Daily Fibonacci 61.8% 1.2288
Daily Pivot Point S1 1.2262
Daily Pivot Point S2 1.2236
Daily Pivot Point S3 1.2206
Daily Pivot Point R1 1.2319
Daily Pivot Point R2 1.2349
Daily Pivot Point R3 1.2376

 

 

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