USD/CAD Rallies Post Fed Decision, Oil Remains Elevated
- USD/CAD started a fresh increase above the 1.2200 resistance.
- A major bullish trend line is forming with support near 1.2150 on the 4-hours chart.
- Crude oil price extended its rally above $70.00 and $72.00.
- EUR/USD and GBP/USD declined sharply below 1.2100 and 1.4080 respectively.
USD/CAD Technical Analysis
The US Dollar formed a base above the 1.2000 level against the Canadian Dollar. As a result, USD/CAD started a fresh increase above the key 1.2100 resistance zone.
Looking at the 4-hours chart, the pair climbed higher nicely above the 1.2120 level. There was a close above the 1.2150 pivot level, the 100 simple moving average (red, 4-hours), and the 200 simple moving average (green, 4-hours).
The pair even rallied above 1.2200 and traded as high as 1.2291. It is now consolidating gains and trading near 1.2275. On the downside, there are many supports, starting with 1.2250 and 1.2220.
There is also a major bullish trend line forming with support near 1.2140 on the same chart. If there is a downside break below the trend line, the pair could test 1.2100 and the 200 SMA. Any more losses could lead the pair back to 1.2000.
On the upside, an immediate resistance is near the 1.2290 level. The next major resistance is near the 1.2320 level, above which the pair could rise towards 1.2400.
Looking at EUR/USD, the pair struggled and declined heavily below 1.2100. Similarly, GBP/USD broke the key 1.4080 support level and declined below 1.4000.
- Euro Zone CPI for May 2021 (MoM) - Forecast +0.3%, versus +0.6% previous.
- Euro Zone Core CPI for May 2021 (YoY) - Forecast +2.0%, versus +2.0% previous.
- US Initial Jobless Claims - Forecast 359K, versus 376K previous.
- Canada’s ADP Employment Change for May 2021 – Forecast 50K, versus 351.3K previous.