USD/CAD climbs to over 1-week tops, near mid-1.3200s
Our preference: long positions above 1.3225 with targets at 1.3265 & 1.3285 in extension.Alternative scenario: below 1.3225 look for further downside with 1.3205 & 1.3170 as targets.
• Remains well bid for the fourth straight session amid the continuation of the USD rally.
• Weaker oil prices further undermine Loonie and remain supportive of the positive move.
The USD/CAD pair continued gaining positive traction on Thursday and
climbed to over one-week tops in the last hour.
The pair built on its recent recovery move from near three-month lows,
with a combination of supporting factors fueling the ongoing positive momentum for the fourth consecutive session.
Despite the recent dovish turn on rate hikes by the Federal Reserve,
the US Dollar extended its recent upward trajectory and strengthened further beyond the 96.00 handle, or near two-week tops.
This coupled with a weaker tone surrounding crude oil prices,
amid concerns over rising US supply, further undermined the commodity-linked currency Loonie and remained supportive.
Today’s up-move, back closer to mid-1.3200s could further be attributed to
some follow-through technical buying, especially after yesterday’s close above the 1.3200 handle,
or 100-day SMA barrier.
It would now be interesting to see if the pair is able to extend the trajectory
or witness some profit-taking at higher levels, given this week’s appreciating move of over 150-pips.
In absence of any major market moving economic releases,
the USD/oil price dynamics might continue to act as key
determinants of the pair’s momentum through Thursday’s trading session.