Market Overview

Loonie Approaches Key Resistance Level Of C$1.2450

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The USD/CAD is trading up 0.15 percent at around $1.2445 level as the US Dollar is taking a breather after the recent fallout. The US government shutdown has been reverted on Monday leaving investors varying about the future direction for the US Dollar.

Amid data empty day for the Canadian Dollar and only minor data scheduled for the US, the USD/CAD fail to benefit from the 0.7 percent rise of the crude oil futures and mild free trade-related optimism as the US and Canada’s officials conduct talks on future shape of the North American Free Trade Association (NAFTA).

From the technical point of view, the USD/CAD is approaching key resistance level of $1.2450 representing a 23.6 percent Fibonacci retracement line of the surge of CAD from $1.2920 toward C$1.2254 on January 5 this year.

With the technical oscillators like the Momentum and the Relative Strength Index being neutral, but pointing higher, the Bearish crossover of the Slow Stochastics might be an indication of Lonnie correcting lower.

While C$1.2450 serves as an immediate resistance level, the rise in the oil prices and last week’s interest rate hike by the Bank of Canada support the CAD bullish view of the currency pair reversing current correction targeting C$1.2250. Should the resistance level be broken, 38.2 percent Fibonacci retracement of above-mentioned slide of USD/CAD lower at C$1.2570 should be the next target

USD/CAD 2-hours chart

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The preceding article is from one of our external contributors. It does not represent the opinion of Benzinga and has not been edited.

Posted-In: FXStreetForex Markets

 

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