Intraday Market Analysis – CAD Bounces Back

By Orbex

USDCAD tumbles towards daily support

The Canadian dollar surged after the BOC’s aggressive rate hike of 50bp. The pair’s recovery came under pressure at 1.2670.

A bearish RSI divergence shows a loss of momentum in the rally and the ensuing break below 1.2580 acts as confirmation of underlying weakness. A combination of stop losses and momentum selling could further depress the greenback.

An oversold RSI may attract some bargain hunters and 1.2480 is a major level to keep the rebound intact. In fact, its breach could cause extended losses beyond 1.2400.

GBPUSD breaks resistance

The pound recoups losses as the UK’s March CPI beats market expectations. Overall sentiment ticked down after the pair dropped below the psychological level of 1.3000.

However, a swift bounce above 1.3080 is an encouraging sign for the bulls as it forced the bears to cover their positions. 1.3180 is the next resistance and a bullish breakout could bring the sterling back to 1.3300 and open the door to a reversal.

The RSI’s overbought condition may lead to a pullback. And 1.2990 is the immediate support should this happen.

USOIL grinds resistance

WTI bounces as major trading houses plan to trim purchases of Russian crude. The price is slowly recovering from the daily demand zone around 94.00.

This could be a consolidation phase after the recent wild ride. The RSI’s double-dip in the oversold territory triggered a buy-the-dips behavior. A break above 105.00 could cause a broader recovery to 115.00.

The RSI’s swing into overextension may limit the impetus. The psychological level of 100.00 is a fresh support and 94.00 is a critical floor to keep the price afloat.

Article by Orbex

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