Forex Market: USD/CAD falls to two-week trough as oil prices extend rally

USD/CAD registered a fresh two-week trough on Tuesday, as the Loonie drew support from recent rally in oil prices.

WTI Crude Oil gained for a third straight trading day on Tuesday as key oil producers Saudi Arabia and the United Arab Emirates flagged capacity limitations, while political unrest in Libya and Ecuador additionally heightened supply concerns.

WTI Crude Oil Futures were gaining 1.10% on the day to trade at $110.78 per barrel.

Canada’s Finance Minister Chrystia Freeland said over the weekend that the economy still had a path to a “soft landing,” where the country could stabilize economically following the impact from the coronavirus pandemic, without facing a severe downturn.

As of 8:57 GMT on Tuesday USD/CAD was edging down 0.41% to trade at 1.2820. Earlier in the European session, the major Forex pair went down as low as 1.2819, which has been its weakest level since June 13th (1.2775).

USD/CAD has risen 1.44% so far in June, following a 1.63% drop in May.

However, data from the US Commodity Futures Trading Commission showed on Friday that speculators had reduced their bullish bets on the Loonie. As of June 21st, net long positions on Canada’s Dollar had decreased to 4,105 contracts from 23,202 contracts during the previous week.

Daily Pivot Levels (traditional method of calculation)

Central Pivot – 1.2885
R1 – 1.2905
R2 – 1.2937
R3 – 1.2957
R4 – 1.2978

S1 – 1.2852
S2 – 1.2832
S3 – 1.2800
S4 – 1.2768