The US dollar fell against the Canadian dollar, clearing a significant amount of support near the 1.24 handle. I believe that the market should continue to be very negative as the oil markets continue to be positive. This of course helps the Canadian dollar, and the overall malaise in the US dollar continues to be an issue. I think that the market is probably going to go looking towards the 1.20 level underneath, and that is an area where I think that we should see plenty of noise. I think if we break down below there, the market is free to go much lower, perhaps reaching down to the 1.15 level next, and then the 1.10 level. That would be an extraordinarily negative move, but quite frankly it looks as if oil is ready to rally much further, and that of course will send us lower.
I’m not interested in buying this market, least not until we break above the 1.25 handle. If we do, then I think we go looking towards the 1.29 level, but quite frankly there’s nothing on this chart suggesting that we are ready to do that anytime soon. The market continues to be negative with the US dollar overall, and the attitude is well ensconced in several currencies, not just the Canadian dollar. If the oil market turns around and rolls over, that could be reason enough for this market to rally, but it doesn’t look likely to happen in the near term.
USD/CAD Video 29.01.18
This article was originally posted on FX Empire
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