The USD/CAD climbs during the day, looking to close on the upside for the fifth week in a row, trading at 1.2632 at the time of writing. As the weekend approaches, the USD/CAD bulls keep pushing the pair towards higher prices, despite the Bank of Canada (BoC) hawkishness in the last two months. USD bulls benefitted from the Fed’s announcement of a bond tapering in the November 3 monetary policy meeting, which spurred a US 10-year Treasury yield spike above 1.60%.

However, US bond yields are plummeting in the day, with the 10-year at 1.528%, falling almost six basis points, at press time. Further, the greenback gains 0.30% with its US Dollar Index, sitting at 95.82, well below the weekly tops, around 96.00. Then how is it possible that the USD/CAD pair is edging higher? The answer lies in falling crude oil prices.

BULLISH AND BEARISH CONDITIONS/ POSSIBILITIES :

USD/CAD bulls kept pushing the pair towards higher prices, though they found strong resistance at the October 3 high, at 1.2654. Worth noticing that swing high is also a weekly resistance that USD bulls fail to break. However, a breach of the latter would expose the confluence of a downslope resistance trendline and the September 29 high around the 1.2770-85 area. A sustained break above the former would expose September 20 high at 1.2895.

On the flip side, failure of a daily close above the October 3 high would add additional pressure on the pair. The first demand zone on the way south would be the 100-day moving average (DMA) at 1.2549, followed by the 50-DMA at 1.2528. A breach of the latter could send the USD/CAD tumbling towards the November 15 low at 1.2492.

USDCAD Near The Neckline

Nov 21 2021