Home Markets USD/CAD rises to three-week highs near 1.2800

USD/CAD rises to three-week highs near 1.2800

USD/CAD rises to three-week highs near 1.2800
  • The dollar remains firm throughout the market.
  • USD/CAD firm to the upside, despite the fact that the rally has been going on for several days.
  • Data ahead: core PCE and US consumer confidence.

The USD/CAD rally is still intact and has been going on for over a week now. In that time the pair went from the 1.2450 zone to reach 1.2796 in the last hour, the highest level since January 6th. The key factor remains the overall strength of the dollar in the market.

The dollar index (DXY) rises for the fifth day and trades at the highest since June 2020. The advance shows no signs of correction at the moment. The momentum that followed the Federal Reserve meeting remains strong. The expectation of the US monetary policy strengthened the dollar and added concerns in the equity markets, adding more firmness to the dollar.

The market’s focus remains on the dollar, Treasury bond yields and Wall Street. On the data side, the US December Personal Income and Expenditure report will be released on Friday, which includes the core index of personal consumption spending. The latter is expected to register an annual rise of 4.8%. In addition, the University of Michigan will report on the Consumer Confidence Index.

Oil remains a factor in the loonie’s favor. On Friday, the barrel of WTI trades without significant changes around $87.20, close to the maximum in years. The price of crude oil has defended itself well despite the fall in the stock markets and signs of a slowdown in the economy.

Overbought and?

Overbought signals in the USD/CAD have not stopped the advances. A correction seems to be on the doorstep, but there are no clear signs yet. A rise above 1.2500 would leave the doors open for more rises. If it is not possible with said level in the next ones, a correction could be given. Supports are seen at 1.2760, followed by 1.2700. At 1.2620 is the strongest level that coincides with the 20-day moving average.

Technical levels



Please enter your comment!
Please enter your name here

Exit mobile version