THE recent recovery in the oil price has seen the Canadian dollar strengthen off its lows against the US dollar due to the loonie’s high sensitivity to Canadian oil exports to the US. A continued rebound in the oil price could well see US dollar-Canadian dollar fall towards trend line support around C$1.0400 and C$1.0330. However, with crude oil prices currently looking a little weak, we could see a recovery back towards the recent highs dollar-Cad highs of C$1.0650. CMC Markets spread on US dollar-Canadian dollar is C$1.0534-C$1.0538.
The euro continued to be out of favour with investors and hit a new all time low against the Swiss franc, despite the Swiss National Bank’s (SNB) Herculean attempts to intervene and weaken the franc. The SNB’s president has said in the past that he plans action to counter “excessive appreciation” of the franc, and the bank’s efforts saw a sharp rise in the euro. But the fundamentals look set to win out and overall, the chart continues to look bad for the euro. Further losses could be made, so any traders who are short might want to add to positions by selling more. Capital Spreads quotes the euro-franc at Sfr1.3805-Sfr1.3809.
The Australian dollar continues to fall against most currency pairs, once again bouncing off the American dollar at the $0.81 level that lent it support on two occasions in late May. The last time it touched $0.81 it rallied to $0.85 in a matter of days but it will take a break of the $0.855 level to confirm a reversal for the pair. Look to buy on dips back to $0.81. Spread Co offer a spread on Australian dollar-dollar of $0.8226-$0.8228.
The euro-dollar pair was “unnaturally bid” according to some traders yesterday morning
as it found plenty of support in the $1.1900–$1.1950 area. This might be the time for traders to take advantage of the euro’s support by selling, since prospects otherwise look gloomy for the Eurozone, as its recent lows suggest. Spread Co offer a spread on euro-dollar of $1.1978–$1.1980.