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USD/CAD hits 2-week lows below 1.3400 as US Dollar tumbles across the board

  • US dollar drops sharply after Powell’s comments. 
  • USD/CAD extends slide, losses 240 pips in two days. 

The USD/CAD pair broke to the downside and extended daily losses. It fell under 1.3400 and bottomed so far at 1.3378, a fresh 2-week low. 

Earlier today, the pair was trading in a range between 1.3425 and 1.3455. It remained within those levels after the release of US and Canadian employment reports. The greenback gained momentum following the data, but higher crude oil prices and jobs and inflation data from Canada offset US dollar’s strength. 

Comments from Fed’s Powell triggered the move to the downside. He spoke about downside risks, citing the falling ISM Manufacturing PMI, concerns about China and other details. The greenback reversed sharply across the board and erased all gains. The DXY dropped from 96.60 to 96.05, reaching a 2-day low. 

Despite rising further versus the US dollar and the new highs in crude oil prices, the Loonie lost ground against AUD and NZD on the back of risk appetite. 

USD/CAD Short-term levels to watch 

As of writing, USD/CAD trades at 1.3395, down 85 pips for the day and more than 200 compared to the level it opened on Wednesday. To the downside, the immediate support is seen at 1.3380, followed by 1.3365 and 1.3335. On the upside, resistance levels might lie at 1.3420, 1.3465 and 1.3490. 

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