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USD/CAD: Upside capped by 1.4100 as oil stabilizes

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Feb 3, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    FXStreet (Mumbai) - The USD bulls took a breather in its upsurge and consolidated the upside, as the Canadian dollar remains pressured following the overnight slump in the black gold.

    USD/CAD mirrors oil moves

    Currently, the USD/CAD pair rises 0.26% higher at 1.4092, struggling hard to extend beyond 1.41 handle. The USD/CAD pair extends its upbeat momentum for the second straight session as the renewed sell-off in oil prices stalled the 5-day rally seen in the CAD last week.

    Oil prices slumped almost 7% yesterday after expectations over a possible meeting Russia and OPEC regarding output cuts were squashed. Moreover, crude reserves as reflected by the EIA report, are expected to grow and add to the already saturated oil markets, which weighed on the oil prices. At the moment, WTI trades -0.55% near $ 29.70, while the Brent drops -0.49% at $ 32.50.

    Markets now await the employment report from both the US and Canada due later this week for fresh insight on the USD/CAD pair.

    USD/CAD Technical Levels

    To the upside, the next resistances are seen near 1.4121/24 (daily R1/ Jan 28 High) and 1.4158/75 (Jan 27 High/ daily R2). To the downside, immediate support might be located at 1.4032/26 (1h 100-SMA/ 50-DMA) and below that 1.4000 (psychological levels).
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