USD/CAD falls below 1.2930 amid weakening USD

  • The US dollar is under pressure amid risk appetite.
  • Oil prices correct on Tuesday, after rising sharply on Monday.
  • USD/CAD reaffirms bearish bias after brief rebound.

The USD/CAD falls for the third day in a row. After a brief rebound from the 1.2900 area towards 1.3000, the pair resumed its decline and is trading below 1.2930.

During the American session, the USD/CAD is trading at 1.2922 (new daily low) as it continues to move towards the 1.2900 zone, a critical area. The move lower is being driven by US dollar weakness and risk appetite.

DXY is at its lowest level in two weeks at 106.50, down 0.80%. It falls for the third time, moving away from multi-year highs. US yields show no clear direction on Tuesday. The US 10-year yield stands at 2.98% and the 30-year yield at 3.14%. Stocks on Wall Street are up 1% on average. Crude oil prices fall by around 1%, after a sharp rise on Monday. API inventory data will be released on Tuesday.

The combination of a weaker dollar and risk appetite weighs on USD/CAD. Other currencies, such as the Australian dollar and the New Zealand dollar, posted higher gains against the greenback.

Economic data released on Tuesday showed housing starts fell to 1,559,000 in June and building permits fell to 1,685,000. In Canada, the key report of the week is the June CPI due out on Wednesday. The market consensus is that the index will increase by 0.9% (monthly) and that the annual rate will go from 7.7% to 8.4%. “A slight disappointment in the CPI adds to our belief that CAD performance is living on borrowed time,” warn analysts at TD Securities.

Technical levels

USD/CAD

Panorama
Last Price Today 1.2921
Today’s Daily Change -0.0043
Today’s Daily Change % -0.33
Today’s Daily Opening 1.2964
Trends
20 Daily SMA 1.2957
50 Daily SMA 1.2864
100 Daily SMA 1.2768
200 Daily SMA 1.2702
levels
Previous Daily High 1.3033
Previous Daily Minimum 1.2898
Previous Maximum Weekly 1.3224
Previous Weekly Minimum 1.2936
Monthly Prior Maximum 1.3079
Previous Monthly Minimum 1.2518
Daily Fibonacci 38.2% 1,295
Daily Fibonacci 61.8% 1.2981
Daily Pivot Point S1 1.2898
Daily Pivot Point S2 1.2831
Daily Pivot Point S3 1.2763
Daily Pivot Point R1 1.3032
Daily Pivot Point R2 1.3099
Daily Pivot Point R3 1.3166

Source: Fx Street

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