USD/CAD remains strong above pivotal 1.3700 mark

USD/CAD remains strong above pivotal 1.3700 mark

 
DXY
-0.18%

The USD/CAD currency pair maintained its strength during today's European session, holding firmly above the significant pivot point of 1.3700. This robustness is attributed to a combination of factors including the strength in the European session and subdued crude oil prices impacting the Canadian dollar (CAD). Additionally, softer Canadian Consumer Price Index (CPI) data has led to reduced expectations for rate hikes by the Bank of Canada (BoC), while a modest uplift in the US dollar followed the release of minutes from the Federal Open Market Committee (FOMC), which seemed to inspire a recovery.

Yesterday, the release of disappointing Canadian inflation figures weakened CAD's outlook and diminished expectations for additional BoC rate hikes. The softer CPI data is a key element influencing market sentiment, as it suggests less aggressive monetary policy in the near term.

From a technical analysis standpoint, USD/CAD is showing signs of support at an ascending trend line that aligns with negative daily chart oscillators around the crucial pivot of the 50-day Simple Moving Average (SMA) at approximately 1.3670-1.3665. A decisive move below this level could indicate bearish intent heading towards a key Fibonacci zone at about 1.3580-1.3575. Conversely, resistance near a weekly high around 1.3750 poses a challenge to upward movements, with yearly peaks near 1.3900 serving as a notable barrier.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.



Tags