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  • USD/CAD reverses and climbs more than 50 pips from daily lows.  
  • Crude oil accelerates decline to fresh multi-month lows after inventory data.  

The USD/CAD pair erased most of the daily gains during the last hour. It bottomed at 1.3055 before bouncing to the upside. As of writing was trading at 1.3115, modestly lower for the day, far from the lows and showing a strong bullish tone.  

The loonie weakened across the board on the back of a slide in crude oil prices. The WTI lost more than $1 and fell to $61.31, reaching a fresh 7 month low. The move lower accelerated as US production reached new record highs and an unexpected increase in crude oil inventories.  

Technical outlook  

From a technical perspective, the rebound in USD/CAD took place from near a key support level around the 1.3050 area: the lower limit of the current ascendant channel and also a horizontal support. A break lower would clear the way to more losses.  

The USD/CAD pair continues to hold a bullish perspective and if it continues to rise, the next resistance could be seen at 1.3115/20, followed by 1.3135 and then 1.3155 (Nov 7 high). On the flip side, support now might lie at 1.3085, the mentioned 1.3050/55 area and 1.3015.