USD/CAD Jumps to 1.2650 as Crude Oil Reverses
USD/CAD erased losses in a few minutes boosted by a decline in crude oil prices and rose back above 1.2650.
The loonie turned lower across the board after crude oil prices tumbles following inventory data. The WTI barrel dropped from levels above $45.00 to $43.90 after EIA showed an increase in inventories.
USD/CAD, that earlier hit a 9-month low at 1.2570, rose from 1.2575 to levels above 1.2650 in a few minutes. Recently it peaked at 1.2657, hitting a fresh daily high. The rally broke a short-term downtrend line giving extra momentum to the US dollar but the pair still trades below Tuesday’s highs. Also market is awaiting the FOMC decision that could have a large impact on the US dollar.
Support at 1.26?
Fort he third time out of the last five days, USD/CAD rebounded sharply from levels under 1.2600. The area has become a relevant support that could favor a rebound. If it remains above, the probability of a correction rally would rise.