USD/CAD Recovery Fizzles as Oil Recovers
Amid rising oil prices and weak US housing data, commodity-linked currencies rose sharply against the US Dollar on Tuesday with USD/CAD pair dropping to 1.2630, its lowest level since July 2015.
1.2630, 9-month low eyed
During Asian session on Wednesday, the pair rose back above 1.2700 mark to 1.2730 as oil prices weakened on news that Kuwait oil workers have called-off the strike. As the day progressed, a minor recovery in crude oil prices took the pair back below 1.2700 mark.
With daily RSI close to oversold territory, it would be prudent to wait for a break below yesterday's close before confirming further downside from current levels. A clear break below 1.2670 would suggest further downward momentum, even below yesterday's intra-day low of 1.2630, towards 1.2570.
On the upside, a move back above day's peak of 1.2730 is likely to trigger a short covering bounce immediately towards 1.2800-20 resistance.
(Market News Provided by FXstreet)