- USD / CAD extends a four-day uptrend.
- WTI slides amid COVID concerns and dollar rise.
- Dollar strength following FOMC minutes added to USD / CAD rally.
The USD / CAD it cut earnings modestly, but remains strong around 1.2750, supported by falling oil and rising dollars.
The greenback is trading near the highest levels in nine months against its main competitors, courtesy of the minutes of the July Federal Reserve meeting, which revealed that the US central bank is preparing to reduce its bond purchase program sooner. from the end of this year.
Meanwhile, the loonie continues to be undermined by the 4% drop in WTI prices amid demand concerns. The rapid spread of delta coronavirus cases around the world coupled with new restrictions have reignited concerns about global growth, in turn weighing the prospects for oil demand.
If risk aversion continues, USD / CAD could extend the gains. The pair reached as high as 1.2772, the highest in a month, and then fell back to the 1.2735 area.
USD / CAD: Technical perspectives
The daily chart shows the bullish scenario of the USD / CAD favorable. The 21-day moving average (DMA) is about to cut the 200 from below, which would confirm a bullish crossover.
The 14-day Relative Strength Index (RSI) is pointing north, well above the midline, suggesting there is more room to the upside.
The next resistance is seen at 1.2807, the high of July 19, should it break above the recent peak. Alternatively, the key level to break down is 1.2641.
USD / CAD: Daily chart
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