USD/CAD is firm while mixed trade holders cloud the USD’s prospects

  • The USD/CAD quotes near the 1,3900 zone in a narrow range before the weekend
  • Contradictory headlines on tariffs between the US and China and resilient oil prices mold the feeling
  • The resistance is observed in 1,3893 and 1,3986, with support in 1,3855

The USD/CAD pair remains stable around the 1,3900 zone on Friday, since the markets weigh the new commercial holders between the US and China and the strongest oil prices against a strongest US dollar. The American dollar index (DXY) is listed up to 99.60, supported by comments from the US president, Donald Trump, suggesting that conversations with China are ongoing. However, these statements were quickly disputed by the Chinese Ministry of Foreign Affairs, which said there was no negotiations, creating confusion and limiting the upward monitoring in the USD/CAD.

The environment is still fragile while operators digest mixed commercial signals. While Trump affirmed advances in negotiations with Beijing, China firmly denied any ongoing tariff consultation, emphasizing that the US should “stop creating confusion.” This contradiction has maintained the appetite for the risk under control, weighing on the futures of US actions and moderating the recent rebound of the DXY.

Oil prices remain a support factor for the Canadian dollar. Brent crude oil remains above $ 68 per barrel after having risen at the beginning of this week, driven by US sanctions to Iranian oil and reports that China could reduce certain US import tariffs According to Commerzbank analysts.

Technical perspective

The USD/CAD is issuing a general bearish signal, contributing flat about 1,3900 and consolidating within the intradic range of 1,3846 to 1,3893. The Relative Force Index (RSI) is neutrally located at 36, while the convergence/divergence of mobile socks (MACD) shows a sale signal, hinting down down.

The impulse indicators are mixed. The rapid stochastic RSI (about 41) and the Bull Bear power (about 0) suggest indecision, without confirming a directional bias. However, trend monitoring signs remain bassists. Simple mobile stockings of 20 days, 100 days and 200 days in 1,4017, 1,4270 and 1,4009 respectively, all have a negative slope, reinforcing the negative tone. Bags are also observed in the 10 -day EMA in 1,3893 and the 10 -day SMA in 1,3863.

The support is found in 1,3855, just above the minimum of this week. A rupture below would exhibit 1,3800 and 1,3745 below. On the positive side, the resistance is found in 1,3863, 1,3893 and the psychological zone of 1,3986. Unless the strength of the USD recovers impulse or oil prices back up, bias for the USD/CAD remains biased down.

Source: Fx Street

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