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5 May 2016
USD/CAD accelerates fall to 1.2800 level
Alongside a sharp rebound in crude oil prices, the USD/CAD pair halted its recovery trend from close to 1.2900 handle and has now dropped back to 1.2800 level.
The pair printed a fresh session low of 1.2785 after the release of weekly jobless claims from the US. The Labor Department reported US initial jobless claims rose by 17,000 to 274,000 during the week ended Apr 29. Although, the reading was higher than 260,000 expected, it is still near historic low levels reflecting broad recovery in the US labor market.
The pair is reversing after nearly testing 1.2900 handle on Wednesday, also marking a short-term descending trend-channel resistance. Hence, the pair could possibly witness some additional selling pressure, should it sustain its weakness below 1.2800 level.
Technical levels to watch
On the downside, 1.2760 level seems to provide some immediate support. Failure to hold 1.2760 support level would confirm near-term movement within the descending trend-channel formation, thus increasing the pair's vulnerability to drop back below 1.2700 handle, towards testing its next major support near 1.2650-45 level.
Meanwhile on the upside, 1.2830-40 area seems to attract some offers, but major upside hurdle remains at the trend-channel resistance near 1.2895-1.2900 handle. Only a convincing break-out of the descending channel would increase the prospects of further near-term recovery for the pair.
The pair printed a fresh session low of 1.2785 after the release of weekly jobless claims from the US. The Labor Department reported US initial jobless claims rose by 17,000 to 274,000 during the week ended Apr 29. Although, the reading was higher than 260,000 expected, it is still near historic low levels reflecting broad recovery in the US labor market.
The pair is reversing after nearly testing 1.2900 handle on Wednesday, also marking a short-term descending trend-channel resistance. Hence, the pair could possibly witness some additional selling pressure, should it sustain its weakness below 1.2800 level.
Technical levels to watch
On the downside, 1.2760 level seems to provide some immediate support. Failure to hold 1.2760 support level would confirm near-term movement within the descending trend-channel formation, thus increasing the pair's vulnerability to drop back below 1.2700 handle, towards testing its next major support near 1.2650-45 level.
Meanwhile on the upside, 1.2830-40 area seems to attract some offers, but major upside hurdle remains at the trend-channel resistance near 1.2895-1.2900 handle. Only a convincing break-out of the descending channel would increase the prospects of further near-term recovery for the pair.