CANADIAN DOLLAR OUTLOOK: USD/CAD PRICE ACTION PIVOTS LOWER AFTER CLASHING WITH 100-DAY MOVING AVERAGEUSD/CAD value reverses decre
CANADIAN DOLLAR OUTLOOK: USD/CAD PRICE ACTION PIVOTS LOWER AFTER CLASHING WITH 100-DAY MOVING AVERAGE
- USD/CAD value reverses decrease because the US Greenback surrenders current features again to the Loonie
- Canadian Greenback bulls stood their floor close to the 1.3400-level and 100-day transferring common
- A restoration in market sentiment appears to have given pause to this month’s rally by USD/CAD
USD/CAD value motion is coming again beneath strain and brings to gentle a notable intraday reversal by the US Greenback. Spot USD/CAD was pushing greater with the broader US Greenback Index throughout early Thursday commerce, however shortly after the opening bell on Wall Road, markets made a powerful effort to stabilize the selloff throughout danger property.
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The clear enchancment in dealer sentiment after S&P 500 bears did not take out main assist was echoed by a pullback within the US Greenback. The US Greenback typically strengthens throughout episodes of danger aversion and usually weakens when urge for food for danger is flush. It’s because the USD is essentially seen as a high safe-haven forex.
USD/CAD PRICE CHART: 4-HOUR TIME FRAME (31 AUGUST TO 24 SEPTEMBER 2020)
Chart by @RichDvorakFX
USD/CAD value motion led the noon reversal decrease by the broader US Greenback following a rejection of the 1.3400-handle. This technical resistance degree hanging overhead USD/CAD is roughly highlighted by the 100-day transferring common and 38.2% Fibonacci retracement of the bearish leg recorded from Could by means of August.
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Downward strain on USD/CAD has accelerated since US Greenback bulls did not take out this massive technical barrier. That stated, spot costs have to this point held the prior session lows and will look to the 1.3300-handle underpinned by lows printed earlier this week. Breaching this potential space of buoyancy might encourage USD/CAD bears to make a push towards resistance-turned-support famous by the 08 September and 16 September swing highs.
USD/CAD PRICE CHART: DAILY TIME FRAME (08 MAY TO 24 SEPTEMBER 2020)
Chart by @RichDvorakFX
A back-test of the 50-day transferring common barely above 1.3200 is one other potential assist zone that might see an inflow of demand for USD/CAD. As such, the main forex pair peeling again in the present day might merely chalk as much as be a wholesome pause within the short-term bullish pattern connecting the string of upper lows this month. The US Greenback has been ripping greater all through September as markets swoon amid resurgent volatility, and it is a doubtlessly bullish USD/CAD theme that appears more likely to linger.
| Change in | Longs | Shorts | OI |
| Each day | -16% | 18% | -6% |
| Weekly | -24% | 24% | -11% |
Maintain Studying: US Greenback Extends Rally as International PMI Information Followers Volatility
— Written by Wealthy Dvorak, Analyst for DailyFX.com
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