The Loonie is holding in the resistance around 1.255 that was cracked pulling the pair back from a full breach into the 1.26 area. The US dollar has reached the highest in two years and the US Treasury 10-year yield touched a three-year high following hawkish signal from the US Federal Reserve. In Asia, the US Dollar has extended those highs. The US dollar Index, hit a fresh 99.903 cycle high, the highest since late May 2020 as it reaches towards blue skies at the psychological 100.00 mark.
In the meantime, the Fed narrative is keeping a lid on rallies in the commodity currencies and the price of oil tanking to the lowest levels since mid-March has not helped the case for CAD. The minute’s Fed released yesterday from the Fed’s March meeting underpin the worries of higher prices and reinforce the prospect that the US central bank’s balance sheet reduction is imminent. On Thursday, St. Louis Fed president James Bullard polished this theme by saying the Fed remains behind the curve despite increases in mortgage rates and government bond yields.
As for oil, the WTI crude oil has been under pressure this week and reached a fresh low on Thursday, reaching a low of $93.84 after falling from a high of $98.80. The price of crude oil has fallen for a second straight day on Thursday. Wednesday’s announcement of the release of 60-million barrels of strategic reserves from members of the International Energy Agency has weighed on the price while a drop in Chinese demand due to quarantines strikes the market.
Looking forward for today, in the schedule investors will be watching the Canadian employment change and Unemployment rate.
Warning:
Trading on CFDs involves a high level of risk, including full loss of your trading funds. Before proceeding to trade, you must understand all risks involved and acknowledge your trading limits, bearing in mind the level of awareness in the financial markets, trading experience, economic capabilities and other aspects.
Disclaimer:
Market Trends, Charts, Trading Ideas or other information provided by BKFX (Pty) Ltd and/or third parties are not intended as an investment advice and/or recommendation. The information provided is not presented as suitable or based on your specific need. You are responsible for your own investment decisions and you should not trade with money you cannot afford to lose. Any views or opinions presented in this Article are solely those of the author and do not necessarily represent those of the Company, unless otherwise specifically stated. The Company may provide the general commentary which is not intended as an investment advice and must not be construed as such. Seek advice from a separate financial advisor if an investment advice is needed. The Company assumes no liability for errors, inaccuracies or omissions, inaccuracies or incompleteness of information, texts, graphics, links or other items contained within this article/material.