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US dollar falls against the Canadian dollar again on Thursday to test a major support

Christopher Lewis

The US dollar fell during the session on Thursday, reaching down towards the vital 1.2750 level that has previously been so important for traders. I think that as we have seen this area being important, I think that paying attention to this pair of the next 24 hours will be very important. I think that the market break and above the 1.28 handle offers a nice opportunity to start buying the US dollar because it is “cheap” at the moment. Otherwise, if we break down below the 1.27 handle, then I think we reach down to the 1.25 level underneath, which is a major level not only technically, but structurally as well.

CPI figures missing in the United States on Thursday has been the latest reason for this market to fall, but it does look like the 1.2750 level is trying to hold up, so I suspect that we may see a bit of a bounce after the last couple of days of the market being so oversold. The Bank of Canada has stepped away from the idea of raising interest rates, and eventually that will send this market higher. Yes, I recognize that the oil markets have an influence on the Canadian dollar as well, but at the end of the day I think it’s somewhat limited by the Canadian economy being a bit softer than its neighbors to the south. This could be the dip we’ve been waiting for.

USD/CAD Video 11.05.18

This article was originally posted on FX Empire