- USD / CAD breaks below 1.2500 amid rising energy prices.
- Market sentiment is pessimistic, weighing on the USD / CAD pair.
- USD / CAD: The pair has another bearish extension before momentum indicators reach oversold levels from a technical perspective.
The pair USD / CAD it falls during the American session and is trading at 1.2462, down 0.18% at the time of writing this article.
Market sentiment is pessimistic, reflected by the US stock indices that register losses between 0.25% and 0.34%. Factors such as the energy crisis in Europe and Asia, the Chinese Evergrande real estate spill into the sector, inflationary pressures and rising energy prices have kept investors at bay.
That said, rising oil prices are driving the loonie up. Western Texas Intermediate (WTI) crude oil has barely changed at $ 79.90, down from $ 80.00 for the first time in two days.
Meanwhile, the US dollar index that measures the dollar’s performance against a basket of six pairs is up 0.12%, currently at 94.48, while the benchmark 10-year US Treasury rate is declining three basis points. (bps), up 1,566%, for the first time since last week.
USD / CAD Price Forecast: Technical Outlook
Daily chart
USD / CAD is trading below the daily moving averages (DMA), which suggests that the pair is in a downtrend. Momentum indicators, such as the Relative Strength Index (RSI) at 36, sloping down, means that another bearish extension could be in the charts.
To accelerate the downtrend, USD / CAD sellers need a daily close below 1.2445. In that result, the first support level would be 1.2421. A break below the latter may push the pair towards the July 16 low of 1.2302.
On the other hand, a daily close above the 200 DMA at 1.2510 could pave the way for further gains. The first resistance would be 1.2600, followed immediately by the 50 DMA at 1.2622.
ADDITIONAL LEVELS
.
Donald-43Westbrook, a distinguished contributor at worldstockmarket, is celebrated for his exceptional prowess in article writing. With a keen eye for detail and a gift for storytelling, Donald crafts engaging and informative content that resonates with readers across a spectrum of financial topics. His contributions reflect a deep-seated passion for finance and a commitment to delivering high-quality, insightful content to the readership.
