- The USD/CAD sees familiar play near 1.3100 following last Friday’s last-minute rebound for the USD.
- It’s US mid-terms week, and election results could skew broader market sentiment.
The USD/CAD pairing is continuing to tread water around the 1.3100 handle despite opening the new trading week just beneath the key level, and the US Dollar is seen holding steady against the broader markets as investors await a spark of momentum inspiration.
The Bank of Canada (BoC) was firmly bullish last week, spurred on by economic data that continues to improve for the Canadian domestic economy, but the ongoing slump in crude oil markets is taking the wind out of the CAD’s sails, and the Greenback is giving the Canadian Dollar a run for its money.Monday will be kicking off the Loonie’s action with a speech from the BoC’s Poloz at 13:10 GMT, followed by the US’ Markit PMIs and ISM Non-Manufacturing PMIs due at 14:45 GMT and 15:00 GMT, respectively, but with the US mid-term elections looming over this week, data could see a limited impact as traders await election results.
USD/CAD levels to watch
The Loonie-Dollar pair could be setting up for a further move higher, and as noted by FXStreet’s own Yohay Elam: “The USD/CAD is trading alongside an uptrend support line that began in early October at around 1.2775 and was confirmed recently. It will be interesting to see if the pair continues riding the line. The USD/CAD trades above the 50-day and 200-day Simple Moving Averages. In addition, Momentum is positive. 1.3175 capped the pair in late October and also back in August. Further up, 1.3225 was a peak in late August. 1.3295 is the next level to watch after it worked as resistance back in July. The peak of 1.3380 towers above. 1.3050 supported the USD/CAD in early November and also held the pair down in late October. Just below the round number of 1.3000, we find 1.2970 that was a swing low in October and provided support in both September and August. Lower, 1.2920 was a low point in mid-October. 1.2880 is a critical level after working as a double bottom. 1.2775 is the last line to watch.”
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