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.
