USD/CAD falls to 11-day lows, market optimism continues

• Canadian dollar rises modestly on Monday, validating last week’s rally.
• Equity markets continue to rise after a great day on Friday.
• USD/CAD with bearish bias, testing support zone around 1.2860.

The USD/CAD is trading slightly lower on Monday and maintains a bearish bias in the very short term. The better mood in the equity markets throughout the world and the stabilization in oil prices after a sharp decline, contribute to the losses of the pair.

The price fell in European hours to 1.2863, the lowest since June 16. It then bounced back towards 1.2890. Despite this rebound, the tone remains bearish. In the event of a return above 1.2910, the USD/CAD would alleviate downward pressures, then 1.2945 appears, which, if broken, would strengthen the dollar.

In the American session preview, USD/CAD is testing the support around 1.2860. If it breaks, the focus would shift to the next strong support at 1.2800 (there is an intermediate support zone at 1.2815).

Optimism keeps the dollar capped

Stock markets are rising around the world after a great week. futures of wall street they advance with the Nasdaq up 0.48% while in Europe the main indices rise 0.55% on average.

The prices of Petroleum they rise modestly around 0.35% and continue to bounce back slowly after bottoming at weekly lows on Wednesday.

The economic calendar shows ahead for the US on Monday the reports of durable goods orders for May, pending home sales for May and the Dallas Fed manufacturing index for June. One of the most important data of the week will be on Thursday with the core price index of personal consumption expenditure. In Canada it will be a light week in terms of data, highlighting only the monthly GDP on Thursday.

Technical levels