USD/CAD pair fell after initially moving higher on Monday. The market formed a shooting star, however this is a very short one and looks like one to ignore. The 1.0150 level should still offer support, and we will wait to see if the 1.02 level can be broken to the upside before buying.
The oil markets are going to be crucial in this currency pair as usual, and the erratic behavior of the Iranians is not going anyone any good at this point. We feel that as long as headlines coming out of that area, it’s going to be difficult to gauge where the oil market goes next. For me purely supply and demand point of view, the oil markets should be falling which of course would make this pair rise. On a break of the Monday shooting star, we would see the overtaking of 1.03 as a bullish sign and be willing to go long at that point in time. As for selling, we need to see the hammer from Thursday get violated to the downside in order to do so. Any selling would more than likely lead us down to parity, while a buy signal will more than likely send this to 1.04 or so.
Written by FX Empire