GBP/CAD Resumes Decline, Hits Fresh 1-Month Lows
The GBP/CAD cross shed around 130 pips on Wednesday, resuming its decline as crude oil prices rallied to fresh 10-month highs.
The commodity, and therefore the CAD, got a boost from US stockpiles data, as the EIA report showed that oil reserves in the US decreased by 3.2 million barrels in the week ending June 3rd, beating expectations for a 2.7 million barrels’ decline.
The Canadian dollar surged against the greenback for a fourth consecutive day, whilst the Pound underperformed, plummeting against its American rival. GBP/CAD is currently trading at 1.8425, down 0.5% on the day.
GBP/CAD technical outlook
“The 4 hours chart for the cross shows that the technical indicators are aiming to recover ground, the RSI indicator in extreme oversold levels and the Momentum a few points below the 100 level, but given that the price stands at its daily lows, seems unlikely it would be able to correct much higher,” said Valeria Bednarik, chief analyst at FXStreet. “In the same chart, the 20 SMA keeps heading lower above the current level, now around 1.8573, favoring some further slides after some short-lived consolidative stage.”
Support levels: 1.8410 1.8355 1.8300. Resistance levels: 1.8465 1.8520 1.8580.