Increased WTI crude oil costs and a dovish Fed have the USD/CAD testing multiyear lows. At press time (about 2:00 PM EST), the Loonie is down 8 pips (-0.07%) on the session. If this pair settles within the crimson on Friday afternoon, it is going to be the fifth-consecutive dropping week for the USD/CAD.
As we strategy the height oil demand summer time season, WTI crude oil futures are buying and selling firmly above the $64.00 deal with. As we speak, June WTI futures are up almost $1.00 and shutting in on $65.00. With just a few weeks till the Memorial Day weekend, it seems as if $75.00 crude oil by July 4th is a possible state of affairs.
On the American financial information entrance, the ISM Manufacturing PMI (April) got here in at 60.7, beneath expectations (65.0) and the earlier launch (64.7). It is a dismal determine and the primary poor quantity now we have obtained in fairly a while. Nonetheless, U.S. shares haven’t been phased because the DJIA is buying and selling above 34,000.
To sum issues up, the image is bearish for the USD/CAD. Increased oil costs and lagging U.S. manufacturing are taking part in in opposition to the Dollar. Consider final week’s dovish Fed statements and a check of 1.2000 within the coming weeks isn’t out of the query.
USD/CAD Continues To Lose Floor
For greater than a month, it’s been all promoting for the USD/CAD. Because of this, two attention-grabbing technical ranges are shortly coming into play.
Listed below are two areas to observe within the coming week(s):
- Help(1): 2018 Low, 1.2247
- Help(2): 2017 Low, 1.2061
Backside Line: It will likely be fascinating to see how the USD/CAD fares at 2018 and 2017’s lows. For now, I’ve purchase orders within the queue from 1.2254. With an preliminary cease at 1.2219, this counter-trend commerce produces 35 pips on a 1:1 danger vs reward ratio.
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