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The USD/CAD pair continues its decline, remaining above 1.3550 amid mixed signals.
Some support for the U.S. dollar is provided by falling oil prices following the International Energy Agency's (IEA) decision to release a record volume of strategic reserves to stabilize prices that surged amid the armed conflict between the U.S. and Israel with Iran. The weakening of oil prices typically puts pressure on the Canadian dollar, which is tied to commodity dynamics, preventing the USD/CAD pair from a broader decline.
After a sharp rise at the beginning of the week, oil prices corrected downward, reducing concerns about rising inflation.
Along with the positive sentiment of investors in the stock markets, this exerts pressure on the dollar as a safe-haven asset.
At the same time, the ongoing risks of further escalation of geopolitical conflicts in the Middle East and the potential blockade of the Strait of Hormuz continue to support demand for the dollar as the primary reserve currency.
Market participants are also exercising caution ahead of the release of fresh U.S. consumer inflation data, considering that the continued rise in energy prices could once again heighten inflationary risks. The U.S. Consumer Price Index report could affect expectations for the Federal Reserve's future interest rate cuts, which, in turn, will determine demand for the dollar. The dynamics of oil prices will remain an additional factor of volatility for the USD/CAD pair.
From a technical standpoint, the pair attempted to halt its decline yesterday but continued to do so today. Nevertheless, prices are holding above 1.3550. If this level is broken, the decline will accelerate toward February's lows. Resistance is at the round level of 1.3600. However, for the bulls to gain an advantage, breaking through this level is not enough; they must also overcome the 20-day SMA around 1.3650. Meanwhile, as the Relative Strength Index (RSI) remains negative, the bulls lack the strength to fight back.
*تعینات کیا مراد ہے مارکیٹ کے تجزیات یہاں ارسال کیے جاتے ہیں جس کا مقصد آپ کی بیداری بڑھانا ہے، لیکن تجارت کرنے کے لئے ہدایات دینا نہیں.
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