USD/CAD Rises to a Fresh 7-Week High, Eyeing 1.3200 Mark
As the crude oil price extended its slide, the USD/CAD
pair extended its upward trajectory for fifth straight trading session
and has now risen to 1.3168, its highest level since early April.
A sharp reversal in the US Dollar (measured by the US Dollar index) since early May lows gained traction after the release of hawkish Fed minutes. Adding to it, renewed concerns of oversupply has dragged crude oil prices lower on Monday and eventually lifting the USD/CAD pair higher.
The pair is currently trading at day's peak level and is now within striking distance of reclaiming 1.3200 handle. Monday's up-move has also lifted the pair above April month daily closing highs resistance and hence, the pair seems more likely to extend its near-term upward trajectory.
Technical levels to watch
On the immediate upside, bulls would be eyeing to capture 1.3200 handle, which if conquered has the potential to further boost the pair towards late March highs resistance near 1.3260-80 region. With daily RSI reading yet to signal near-term overbought conditions, the pair seems unlikely to witness any serious corrective before testing 1.3260-80 resistance.
Meanwhile, on the downside 1.3150-45 resistance break-point now seems to act as immediate support, which if broken could drag the pair back below 1.3100 handle to 1.3090-85 support area. Any further weakness below 1.3100 mark is likely to get bought into and hence, should be limited at 1.3000 psychological mark support.