The US dollar market has been soft overall, and the Canadian dollar of course will be any different but with the stronger than anticipated Canadian economic numbers recently, this number has fallen a bit stronger than anticipated. Add to that the fact that the oil markets have been bullish as well, and then it makes sense that we have been drifting lower. For me, I believe that the 1.25 level is vital to hold the uptrend that we had seen over the last several months. A breakdown below the 1.25 handle, the market then looks very soft, and we should continue to go much lower.
In general, I believe that we will eventually find buyers but if we were to break down below the 1.25 handle, we could then go down to the 1.20 level underneath. The 1.20 level of course is going to be massively important, as it could determine where we go over the longer term. I think oil of course have it say, and I also believe that oil markets are starting to get a bit overstretched, so I would not be surprised at all to see this market bounce, but I think it’s not going to happen until we reach towards the 1.25 level, offering short-term traders a selling opportunity in a market that has been pummeled as of late. Thin holiday trading of course will have its influence as well, so having said that I think that the markets might be a bit difficult to deal with, but longer-term I think we will decide sometime in early January.
USD/CAD Video 29.12.17
This article was originally posted on FX Empire
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