Latching on to the huge gas and distillates increases
The USDCAD moved to yet another 12+ year high today with the pair trading at the highest level since the week of July 20 2003. The swing high from that week 12+ years ago came in at 1.4164. That is a target above. The high today reached 1.4107.
Crude oil inventories were down in the current week, but gasoline and distillates were up sharply. The USDCAD has ignored the crude fall and focused on the others. The price of the USDCAD has risen as a result. Looking at the 5-minute chart the technical are also trying to help. The correction off the high today stalled just above the 200 bar MA (green line in the chart below) and is now above the 100 bar MA (blue line - a close risk level).
Admittedly, the trend line formed from the steady march higher into the beginning of the North American session was broken and that may present a challenge on the topside at the 1.4100 area (see chart below). However with crude trading at the lows despite the drawdown (it is at $34.30 currently after closing near $36 yesterday), cautious traders will likely have stops on a break above the level - just in case. The trend is this pairs friend (and crudes friend as well).
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