USD/CAD Heading for 1.37 After MAs Held As Support
USD/CAD has been bullish since early February as the USD started to find decent bids again, after the price bounced off the 200 SMA (purple) on the daily chart. This moving average held as support on two occasions, with a support zone forming around 1.3260-70. The news from UAE last Friday that they may consider leaving OPEC caused the Oil price to drop initially which benefited this pair.
Although, Oil prices rebounded and yesterday US WTI moved above the 100 SMA (green) on the daily chart above, which has been acting as resistance since the middle of last year. So, this is a strong bullish signal despite a lower GDP revision for this year by the Chinese government. Although, the strong move higher in Oil on Friday evening came after Saudi Arabia hiked Oil prices for European and Asian customers in a surprise move.
Yesterday, this pair attempted to break above the 100 SMA on the H1 chart, but faced resistance from sellers at around 1.3630. USD/CAD reversed lower and found support at the 200 SMA on the same timeframe, but eventually broke below that level as well, reaching a low of 1.3550s before bouncing back up to the 200 SMA.
The next target is yesterday’s high at 1.36412. If buyers manage to push the price above that level, it would prompt traders to target the highs from this week and the previous Friday, around 1.3665. Although the real test will come at 1.37, which was the high back in December.
Although, with the FED keeping the bullish rhetoric going, while the Bank of Canada paused rate hikes in the last meeting, chances are that the bullish momentum might keep going. So, we will observe the price action up there, which this pair will likely reach after today’s testimony from the FED chairman Jerome Powell in the US Congress.
USD/CAD Live Chart
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