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CAD Hitches A Ride As Crude Prices Surges

By ORBEXForexApr 23, 2019 03:34AM ET
www.investing.com/analysis/cad-hitches-a-ride-as-crude-prices-surges-200409281
CAD Hitches A Ride As Crude Prices Surges
By ORBEX   |  Apr 23, 2019 03:34AM ET
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The Canadian dollar rose on the back of rising crude oil prices. WTI crude oil closed on Monday with 2.45% gains. This allowed the Canadian dollar to post gains of 0.25% on the day as a result.

Some of the markets were closed on Monday and trading was subdued. Existing home sales report showed a print of 5.21 million units against forecasts of a decline to 5.30 million.

Euro Trades Subdued

The sentiment in the euro is hit by the weak PMI’s from last week. But the currency rose slightly to post a modest 0.12% gain on the day. Economic data was sparse, and today’s docket will see the eurozone consumer confidence report coming out. Economists forecast the consumer confidence to hold steady at -7 EUR/USD.

Consolidating Into a Bearish Flag


The EUR/USD has moved into a temporary holding pattern, forming a bearish pattern. The current retracement could see a downside breakout validating the bearish outlook. Closing below the recent swing low of 1.1228 could signal further declines. The minimum downside is at the support level of 1.1176.

EUR/USD, 4 Hour
EUR/USD, 4 Hour

Crude Oil at Six-Month High as Iran Waivers End

Oil prices settled at a six-month high on Monday. The gains came after President Trump announced an end to Iran’s crude oil exports to eight countries. Oil production will now suffer the blow of the sanctions on Iran and Venezuela as well as the political unrest in Libya. In retaliation, Iran threatened to close the Straits of Hormuz which could lead to longer delays in crude oil shipments.

Can WTI Maintain the Momentum?

Following the surge to the 65 – 66 region, the momentum looks somewhat mixed. If oil prices fail to post any major highs from this level, we expect to see prices turning flat. This also potentially sets the tone for a short term correction. The initial support level is at 64.50 which remains a key level to the downside.

WTI, 4 Hour
WTI, 4 Hour

Gold Trades Flat as Declines Stall

The recent declines in gold prices are set for a pause. Price is stabilizing above the 1274 handle. Ahead of a busy week that includes central bank meetings and the US advance GDP reports, gold investors are likely to wait and watch for data. For now, the risk sentiment remains somewhat mixed. But we will get a better idea as the markets open following a long Easter weekend.

XAU/USD Forming an Inverse Head and Shoulder Pattern

XAU/USD has been consolidating above the previous lows at 1275. In the process, an inverse head and shoulders is forming with the neckline resistance at 1279.25. With the right shoulder forming, we expect a breakout above the neckline resistance. An expected move to the upside will see gold prices targeting the 1285 level.

GOLD, 4 Hour
GOLD, 4 Hour

CAD Hitches A Ride As Crude Prices Surges
 
CAD Hitches A Ride As Crude Prices Surges

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