Canadian Dollar Outlook: Key USD/CAD, CAD/JPY Levels to Watch
10 Feb 2021 12:00, GMTWhat's on this page
CAD, CAD/JPY Analysis and Talking Points
USD/CAD | Rising Oil Prices Underpins CAD Gains
Last week had largely been characterised as a sell the rally bias with the 1.2850-70 area capping upside. Alongside this, with the weak Canadian jobs report quickly shrugged off, momentum has once again shifted to the downside. Brent crude futures have continued its impressive run with prices above $61, which is likely to keep the Loonie underpinned and thus makes the currency among the preferred choices for a renewed USD bearish trade. On the downside, support is situated at 1.2620-25 with the YTD low at 1.2586.
Canadian Dollar Technical Levels
| Support | Resistance | ||
|---|---|---|---|
| 1.2650 | - | 1.2750 | - |
| 1.2620-25 | - | 1.2815 | Trendline |
| 1.2586 | YTD Low | 1.2881 | YTD High |
Canadian Dollar Chart: Daily Time Frame
Source: Refinitiv
| Change in | Longs | Shorts | OI |
| Daily | 26% | -19% | -6% |
| Weekly | -14% | 4% | -4% |
CAD/JPY | Bullish Momentum Persists
Yesterday’s dip in the cross had been quickly faded with dip buyers at 82.00, with additional support stemming from reports that the BoJ may seek to clarify in March policy review that it has room to deepen negative rates. Momentum remains positive for the cross, particularly as equity markets extend to better levels. In turn, 82.00-20 is likely to continuing offering good support for CAD/JPY, while on the topside, resistance is situated at 83.00.
CAD/JPY Chart: Daily Time Frame
Source: Refinitiv
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