- The Canadian dollar among the worst results of the American session.
- US and Canadian bonds rise strongly.
- USD/CAD rises to the highest level since last Wednesday.
The USD/CAD It broke higher after trading in a small range for hours and jumped to 1.2872, reaching the highest level since last Thursday. The pair remains near the highs, with the bullish momentum intact.
Loonie weakens, USD/CAD bounces off weekly lows
The loonie fell across the board during the American session amid risk aversion. She also lost ground against the AUD and the NZD. The Dow Jones falls 1.40% and the Nasdaq 3.40%. US and Canadian yields are falling, currently at multi-day lows.
The fall in share prices offered some support to the dollar, which was affected by weaker-than-expected US economic data. The S&P Global PMI disappointed expectations. The S&P Global Composite fell in May to the lowest level in five months, according to preliminary data, to 53.8, below the 56 and 55.5 market consensus. New home sales fell 16.6% in April, worse than expected. The FOMC Minutes will be released on Wednesday. In Canada, the next major economic report will be released on Thursday with retail sales.
Resistance before 1.2890
USD/CAD is turning higher, rebounding from two-week lows. The pair found support above 1.2760 and is now looking to test the 1.2890 area. A consolidation above 1.2900 should bolster the dollar’s outlook.
On the other hand, 1.2815/20 is the key support. If USD/CAD breaks below, the recent low at 1.2764 would be exposed. Below, the next support lies at 1.2714 (low May 5).
Technical levels
Source: Fx Street
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