The USD/CAD is trading higher on the day as the loonie returned some of the past few days’ gains. This has led to a 0.37% rise in price, with most of the gains coming in the early New York session.
The CAD is facing pressure on the day from renewed selling pressure on crude oil prices ahead of the weekly US crude inventories report by the US Energy Information Administration (EIA).
The US Dollar is also gaining on other fronts, as traders who had shorted the currency earlier start to take profits. With no major macroeconomic data scheduled for the day, crude oil price remains the dominant factor dominating price action on the pair.
Technical Levels to Watch For
The active daily candle is about to challenge the resistance formed by the channel. If the candle breaks this resistance, a move towards 1.21708 could be in the works. Above this level, 1.22467 and 1.23142 come into the picture as additional upside targets.
On the other hand, a rejection at the channel’s upper border sets up a retest of 1.20830, with 1.20458 and 1.2000 lining up as additional support targets. The latter aligns with the lower edge of the channel, so a break of this border automatically puts 1.19357 into focus as a potential multi-year low.