“¢ The ongoing USD bullish run helps build on last week’s goodish rebound.
“¢ Subdued crude oil prices did little to influence the commodity-linked Loonie.
“¢ Technical studies indicate an extension of the positive momentum.
The USD/CAD pair now seems to have entered a bullish consolidation phase and was seen oscillating in a narrow trading band, around mid-1.3100s, or near three-week tops.
The pair built on last week’s goodish rebound from 100-day SMA support and was being supported by the ongoing US Dollar bullish run, which remains underpinned by the global flight to safety amid mounting currency crisis in Turkey.
A steep decline in the Turkish Lira now seems to have paused, at least for the time being, and a consolidative USD price action was seen leading to a range-bound/subdued price action through the early European session.
Meanwhile, a weaker tone around crude oil prices also did little to revive demand for the commodity-linked currency – Loonie, with the USD price dynamics turning out to be an exclusive driver of the pair’s momentum at the start of a new trading week.
Technical Analysis
Today’s up-move could also be attributed to some follow-through technical buying, especially after Friday’s decisive move beyond 50-day SMA. In absence of any market-moving economic data, a follow-through positive momentum, towards testing a short-term descending trend-channel hurdle, now looks a distinct possibility.
Immediate resistance is pegged just ahead of the 1.3200 handle, which if cleared would point to a near-term bullish breakout and pave the way for an extension of the positive momentum further towards 1.3270-75 supply zone.
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