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USD/CAD RETREATS FROM 3-DAY OLD TRADING RANGE, AROUND 1.2520 LEVEL

•  USD struggles to build on overnight recovery move.

•  Bullish oil prices underpin commodity-linked Loonie.

 

The USD/CAD pair came under some fresh selling pressure and eroded part of previous session's modest recovery move from 2-1/2 month lows.

 

The pair extended its consolidative price action and is now retreating from a three-day-old trading range resistance near the 1.2555-60 region. Despite a goodish pickup in the US Treasury bond yields, the US Dollar struggled to gain any follow through traction and failed to assist the pair to build on overnight rebound.

 

Meanwhile, the ongoing bullish run-up in oil prices, with WTI crude oil surging to its highest level since mid-2015 amid Iran tensions, underpinned the commodity-linked Loonie and further collaborated to the pair's weaker tone on Thursday.

 

Currently trading around the 1.2520 region, testing session lows, today's release of ADP report and weekly jobless claims from the US, followed by the weekly crude oil inventories data would now be looked upon to grab some short-term trading opportunities.

 

Technical levels to watch

 

Immediate support remains near the key 1.25 psychological mark, below which the pair is likely to accelerate the slide towards 1.2455-50 strong horizontal support. On the upside, the 1.2555-60 area now seems to have emerged as an immediate strong hurdle, which if cleared could trigger a short-covering bounce back towards 100-day SMA barrier near the 1.2595-1.200 region.

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