Intraday Market Analysis – CAD Claws Back Losses.
USDCAD capped by key resistance
The Canadian dollar recovered after a rise in the August CPI.
The previous attempt to break below 1.2500 has put the bulls under pressure. The rebound met offers at 1.2760 when the RSI was in an overbought situation. A bullish breakout would send the price to the peak around 1.2900.
On the downside, 1.2600 is fresh support as buyers try to hold onto recent gains. Its breach could force them to abandon ship and trigger a sell-off to 1.2500, which would be the ultimate test of the bulls’ commitment.
NZDUSD seeks support
The New Zealand dollar inched higher after the Q2 GDP beat expectations.
The bulls are looking to consolidate their gains after they cleared the daily resistance at 0.7100. A bullish MA cross on the daily chart indicates a bullish bias. However, the kiwi’s struggle to stay above 0.7100 is a sign of overextension in the short term.
A controlled pullback is necessary to gather momentum after a rebound stalled at 0.7150. 0.7055 is the immediate support. Then the psychological level of 0.7000 is a crucial floor.
USOIL rally gains momentum
WTI crude shot higher after the EIA reported a large drop in US inventories.
A bullish MA cross on the daily chart suggests that sentiment has turned positive. After a brief consolidation, price action has lifted the psychological level of 70.00, turning it into fresh support.
As the upward momentum picks up speed, the oil price is heading to 74.10. The quick recovery would put the August sell-off behind and resume the 17-month long rally. A limited retracement may occur as the RSI inches into the overbought area.
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