CANADIAN DOLLAR OUTLOOK: USD/CAD PRICE ACTION PIVOTS LOWER AFTER CLASHING WITH 100-DAY MOVING AVERAGE
- USD/CAD cost reverses reduce as a US Dollar surrenders new gains behind to a Loonie
- Canadian Dollar bulls stood their belligerent nearby a 1.3400-level and 100-day moving average
- A liberation in marketplace view seems to have given postponement to this month’s convene by USD/CAD
USD/CAD cost movement is entrance behind underneath vigour and brings to light a important intraday annulment by a US Dollar. Spot USD/CAD was pulling aloft with a broader US Dollar Index during early Thursday trade, though shortly after a opening bell on Wall Street, markets done a clever bid to stabilise a selloff opposite risk assets.
The transparent alleviation in merchant view after SP 500 bears unsuccessful to take out vital support was echoed by a pullback in a US Dollar. The US Dollar generally strengthens during episodes of risk hatred and typically weakens when ardour for risk is flush. This is given a USD is mostly noticed as a top safe-haven currency.
USD/CAD PRICE CHART: 4-HOUR TIME FRAME (31 AUGUST TO 24 SEPTEMBER 2020)
Chart by @RichDvorakFX
USD/CAD cost movement led a midday annulment reduce by a broader US Dollar following a rejecting of a 1.3400-handle. This technical resistance turn unresolved beyond USD/CAD is roughly highlighted by a 100-day relocating normal and 38.2% Fibonacci retracement of a bearish leg available from May by August.
Downward vigour on USD/CAD has accelerated given US Dollar bulls unsuccessful to take out this large technical barrier. That said, mark prices have so distant hold a before event lows and could demeanour to a 1.3300-handle underpinned by lows printed progressing this week. Breaching this intensity area of irresolution could inspire USD/CAD bears to make a pull toward resistance-turned-support remarkable by a 08 Sep and 16 Sep pitch highs.
USD/CAD PRICE CHART: DAILY TIME FRAME (08 MAY TO 24 SEPTEMBER 2020)
Chart by @RichDvorakFX
A back-test of a 50-day relocating normal somewhat above 1.3200 is another intensity support section that could see an liquid of direct for USD/CAD. As such, a major banking pair bark behind currently could simply marker adult to be a healthy postponement in a short-term bullish trend joining a fibre of aloft lows this month. The US Dollar has been ripping aloft via Sep as markets swoon amid resurgent volatility, and this is a potentially bullish USD/CAD thesis that looks expected to linger.
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