USDCAD formed a bottom around 1.30595 and shown a good recovery of more than 80 pips. The jump was mainly due to broad-based US dollar buying and weak oil prices. The US 10 year yield is trading lower and has broken major support at 1.97%. It declined by 1.95% lowest level till 2016. The pair recovered till 1.31453 and is currently trading around 1.30973.
The WTI crude oil price has lost more than $4 in the past two trading days despite OPEC production cuts and large crude oil inventory draw. According to API, there was a draw of 5 million barrels compared to a forecast of 2.484 million barrels. It hits low of $56.02 and is currently trading around $56.76.
The near term resistance is around 1.3150-588 (23.6% fib and 10- day MA) and any break above will take the pair to next level till 1.3185/1.3230. Minor trend reversal only above 1.3230.
On the flip side, near term support is at 1.30585 and break below targets 1.302/1.3000.
It is good to buy on dips around 1.30680-700 with SL around 1.3000 for the TP of 1.3230.
