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USDCAD Rising on Crude Oil Weakness

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Written By: Alejandro Zambrano

May 23, 2019, 17:22 BST 17:22

Summary:

USDCAD continues to rise through the mid-European session and is currently trading close to the 1.3462 level.

USDCAD continues to rise through the mid-European session and is currently trading close to the 1.3462 level.

Today, the price added to its gains following yesterday’s reversal from the key support level at 1.3380, and yesterday’s formation of a clearly defined daily Japanese candlestick “Hammer” pattern.

The US Dollar remains supported by the latest FOMC meeting minutes, which lowered prospects for interest rate cuts in 2019. This, coupled with a strong weakness in Crude Oil prices, added further bearish pressure on CAD and led to the rise of the USDCAD pair.

On the technical side – the aforementioned Hammer formed in the proximity of the strong support area at the intersection of the support trendline of the daily up channel from February and the lower daily Bollinger Band. Today’s bullish move hints of further gains in the days ahead towards the multi-pivot high from April at 1.3500.

USDCAD Daily Chart

Written By: Alejandro Zambrano

Alejandro Zambrano combines extensive professional experience and a pragmatic attitude to trading, building clients’ understanding of the markets and the rationale behind investing. Zambrano was the Chief Market Strategist of the FCA regulated broker, Amana Capital. Prior to that, he was also the Head Analyst at FXCM’s London research desk. Interact with Alex via Twitter at @AlexFX00.