#USDCAD @ 1.34247 meets with a fresh supply on Tuesday and drops to a nearly four-week low. (Pivot Orderbook analysis)
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- USD/CAD meets with a fresh supply on Tuesday and drops to a nearly four-week low.
- Weaker Oil prices undermine the Loonie and lend support amid a modest USD bounce.
- The mixed fundamental backdrop warrants some caution before placing directional bets.
The pair currently trades last at 1.34247.
The previous day high was 1.3462 while the previous day low was 1.3418. The daily 38.2% Fib levels comes at 1.3445, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1.3434, expected to provide resistance.
The USD/CAD pair struggles to capitalize on the previous day’s modest gains and comes under some renewed selling pressure on Tuesday. Spot prices continue drifting lower through the early part of the European session and drop to a nearly four-week low in the last hour, albeit showed some resilience below the 1.3400 round-figure mark.
The initial market reaction to additional supply cuts by Saudi Arabia and OPEC fades rather quickly amid persistent concerns over slowing economic growth and weakening demand. This, in turn, drags Crude Oil prices lower for the second straight day, which, along with the emergence of some US Dollar (USD) dip-buying, helps limit the intraday losses for the USD/CAD pair. Any meaningful upside for the USD, however, seems limited amid expectations that the Federal Reserve (Fed) will skip hiking interest rates next week.
In fact, the current market pricing indicates a greater chance that the US central bank will leave interest rates unchanged at the June policy meeting. Against the backdrop of last week’s dovish rhetoric from several FOMC officials, the disappointing release of the US ISM Services PMI on Monday, which fell to 50.3 in May, reaffirmed market bets for an imminent pause in the Fed’s rate-hiking cycle. This keeps the US Treasury bond yields depressed, which might hold back the USD bulls from placing bets and cap the USD/CAD pair.
That said, the prevalent cautious market mood could lend some support to the safe-haven Greenback and the USD/CAD pair. In the absence of any relevant market-moving economic releases from the US, the mixed fundamental backdrop makes it prudent to wait for some follow-through selling before positioning for any further depreciating move. Market participants now look to the release of the Canadian Ivey PMI, which, along with Oil price dynamics, might influence the Canadian Dollar (CAD) and provide some impetus to the major.
Technical Levels: Supports and Resistances
USDCAD currently trading at 1.3415 at the time of writing. Pair opened at 1.3445 and is trading with a change of -0.22 % .
| Overview | Overview.1 | |
|---|---|---|
| 0 | Today last price | 1.3415 |
| 1 | Today Daily Change | -0.0030 |
| 2 | Today Daily Change % | -0.2200 |
| 3 | Today daily open | 1.3445 |
The pair remains strongly bearish on the daily time frame. It trades below the 20 SMA @ 1.3508, 50 SMA 1.3502, 100 SMA @ 1.3518 and 200 SMA @ 1.3509.
| Trends | Trends.1 | |
|---|---|---|
| 0 | Daily SMA20 | 1.3508 |
| 1 | Daily SMA50 | 1.3502 |
| 2 | Daily SMA100 | 1.3518 |
| 3 | Daily SMA200 | 1.3509 |
The previous day high was 1.3462 while the previous day low was 1.3418. The daily 38.2% Fib levels comes at 1.3445, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1.3434, expected to provide resistance.
Note the levels of interest below:
- Pivot support is noted at 1.3421, 1.3397, 1.3377
- Pivot resistance is noted at 1.3465, 1.3486, 1.351
| Levels | Levels.1 |
|---|---|
| Previous Daily High | 1.3462 |
| Previous Daily Low | 1.3418 |
| Previous Weekly High | 1.3651 |
| Previous Weekly Low | 1.3407 |
| Previous Monthly High | 1.3655 |
| Previous Monthly Low | 1.3315 |
| Daily Fibonacci 38.2% | 1.3445 |
| Daily Fibonacci 61.8% | 1.3434 |
| Daily Pivot Point S1 | 1.3421 |
| Daily Pivot Point S2 | 1.3397 |
| Daily Pivot Point S3 | 1.3377 |
| Daily Pivot Point R1 | 1.3465 |
| Daily Pivot Point R2 | 1.3486 |
| Daily Pivot Point R3 | 1.3510 |
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