- The loonie rose across the board on Tuesday as the U.S. dollar retreated.
- USD / CAD is heading to test October lows at 1.3098 as bearish pressure intensifies.
The USD / CAD It is falling for the third consecutive trading day, accelerating the decline. It is trading at 1.3115 / 20, approaching the October lows. The loonie is among the top performers on Tuesday.
The pair traded sideways for most of the day between 1.3170 and 1.3200 until it broke lower during the US session. It fell to 1.3115, hitting a six-day low.
The drop came amid a decline in the US dollar across the board during the US session. The dollar lost strength and cut gains against the AUD, NZD and JPY and fell further against the EUR. The euro and loonie are among the top performers on Tuesday.
The DXY fell to 93.02, the lowest since October 9 and is under pressure. A decline below 93.00 would suggest more weakness ahead of the dollar.
Attention is now on negotiations in the United States for a new round of fiscal stimulus. The Speaker of the House of Representatives, Nancy Pelosi, will speak in a few hours with the Secretary of the Treasury, Steven Mnuchin. According to Pelosi, today is the last day to reach an agreement that could be voted on before the November 3 elections.
From a technical perspective, USD / CAD remains bearish about to test the October low located at the 1.3100 zone. A break to the downside would likely lead to more losses. The next strong support is seen at 1.3035. On the upside, the dollar needs to rise above 1.3250 / 60 to remove and negate the downside bias.
Credits: Forex Street
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