USD/CAD struggles to advance beyond 1.3700 as WTI steadies above $30

Crude oil plunges as producers trigger a global price war.
WTI stages a technical rebound after dropping to $27.30 on Monday.
US Dollar Index erases 1% amid plummeting US T-bond yields.

Eren Sengezer FXStreet

The USD/CAD pair surged at the start of the week and touched its highest level since May 2017 at 1.3758 as plummeting crude oil prices weighed heavily on the commodity-sensitive CAD. With crude oil prices staging a technical rebound during the European trading hours, the pair pulled away from its tops but found support at 1.3570. As of writing, USD/CAD was trading near 1.3650, adding 1.7% on a daily basis.

WTI crashes, USD continues to weaken against its peers

After failing to reach an agreement on oil production cuts with Russia on Friday, Saudi Arabia slashed its export oil prices to start a global price war. With the initial reaction, the barrel of West Texas Intermediate fell to $27.30 before retracing a portion of its sharp fall. At the moment, the WTI is trading at $32.20, still down more than 20% on a daily basis.

Commenting on this development, "due to the drop in global oil demand, in combination with the existing and most likely even rising oversupply, oil prices will continue to trade lower, and for longer," said ABN AMRO senior energy economist Hans van Cleef. "In line with our downward revisions of economic growth forecasts, global oil demand will only modestly recover during the second half of 2020."

In the meantime, the US Dollar Index (DXY) extended its slide as markets hit the panic button and caused the 10-year US Treasury bond yield to fall to a fresh record low of 0.36%. With the DXY erasing nearly 1% and struggling to make a meaningful recovery, the pair's upside remains limited for now.

There won't be any macroeconomic data releases from the US or Canada on Monday and markets will remain focused on crude oil prices and Wall Street's opening bell.

Technical levels to watch for

WTI

Overview
Today last price	32.24
Today Daily Change	-9.57
Today Daily Change %	-22.89
Today daily open	41.81

Trends
Daily SMA20	49.66
Daily SMA50	53.96
Daily SMA100	55.76
Daily SMA200	55.75

Levels
Previous Daily High	46.48
Previous Daily Low	41.22
Previous Weekly High	48.74
Previous Weekly Low	41.22
Previous Monthly High	54.69
Previous Monthly Low	43.95
Daily Fibonacci 38.2%	43.23
Daily Fibonacci 61.8%	44.47
Daily Pivot Point S1	39.86
Daily Pivot Point S2	37.9
Daily Pivot Point S3	34.59
Daily Pivot Point R1	45.12
Daily Pivot Point R2	48.43
Daily Pivot Point R3	50.39

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.

EUR/USD trims gains, back below 1.1800

EUR/USD now loses some upside momentum, returning to the area below the 1.1800 support as the Greenback manages to regain some composure following the SCOTUS-led pullback earlier in the session.

GBP/USD off highs, recedes to the sub-1.3500 area

Following earlier highs north of 1.3500 the figure, GBP/USD now faces some renewed downside pressure, revisiting the 1.3490 zone as the US Dollar manages to regain some upside impulse in the latter part of the NA session on Friday.

Gold climbs to weekly tops, approaches $5,100/oz

Gold keeps the bid tone well in place at the end of the week, now hitting fresh weekly highs and retargeting the key $5,100 mark per troy ounce. The move higher in the yellow metal comes in response to ongoing geopolitical tensions in the Middle East and modest losses in the US Dollar.