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USD/CAD drops to lows near 1.3370

FXStreet (Edinburgh) - After posting fresh 11-year tops near 1.3440, USD/CAD has quickly lost nearly 70 pips to print session lows in the 1.3375/70 band.

USD/CAD lower on oil recovery

The sudden spike in crude oil prices – testing the mid-$45.00 as of writing – is lending further support to the Canadian dollar, collaborating with the leg lower at the same time.

The outlook on the pair remains on the bullish side nonetheless, supported by the divergence between the Federal Reserve and the Bank of Canada, as well as the bearish prospects surrounding crude oil prices.

According to strategists at TD Securities, “We think a washout towards the 1.3150/1.3200 will be necessary to resume a more sustainable uptrend that we expect over the next several months”.

USD/CAD levels to consider

The pair is now losing 0.06% at 1.3388 and a break below 1.3370 (low Sep.29) would open the door to 1.3303 (low Sep.25) and finally 1.3233 (low Sep.23). On the other hand, the initial hurdle lies at 1.3435 (high Sep.29) followed by 1.3495 (high Jun.29 2004) and then 1.3500 (psychological level).

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