The US dollar went back and forth with a general negative attitude during the day on Monday. We continue to see the Canadian dollar enjoy strength due to the stronger-than-expected employment figures last week, but ultimately, I think that the oil markets will be a problem for the Canadian dollar. While the oil markets started to rally during the session on Monday, they are most certainly negative, and it’s only a matter of time before currency traders start selling off the Canadian dollar in reaction. On the daily charts, we are closer to the bottom of the consolidation area than we are the top, and I believe it’s only a matter of time before we continue the consolidation that has been a mainstay of this market. I believe that the 1.3550 level above continues to be resistance, but eventually we could break above there, especially if the oil markets break down significantly.
I have no interest in selling
I have no interest in selling this market, at least not unless we break down below the 1.3350 level, which is massive support. If we break down below there, it would probably accompany a massive move higher in the oil markets. However, I don’t think that the market is going to do that, so it makes more sense for this market to rally. I don’t know if will be over to break out to the upside quite yet, but given enough time I suspect it will happen. The market continues to be volatile, but given enough time it is a situation that I think favors the buyers as there is so much in the way of support just below. Also, I do feel that it’s only a matter of time before the oil markets break back down, and that should continue to put upward pressure in this market.
Written by FX Empire