FxWirePro: USD/CAD trades slightly lower on rising crude oil price, good to buy on dips

USDCAD was one of the top performer in year 2018. The pair has jumped nearly 8% this year on account of weak oil price and dovish Bank of Canada statement. It hits high of 1.36615 and lost nearly 100 pips on account of slight jump in oil prices .It is currently trading around 1.36082.

Brent crude jumped sharply more than 10% on account of declining Saudi exports . Saudi’s exports in Dec fell by about a half a million barrels a day. The decline in Manufacturing activity in China is adding concern to economic slowdown. The commodity hits high of $56.599 and is currently trading around $55.44.

Loonie is expected to trade further higher in the first quarter of 2019. Overall economic growth of Canada is good and unemployment rate is at 40-year low. Canada’s GDP is growing at better rate and is 0.3% for the month of Oct compared to forecast of 0.1%. But BOC major concern which is preventing them from rate hike is oil prices.

On the higher side, near term resistance is around 1.3690 and any violation above targets 1.37934/1.4000. But RSI in monthly chart is above 50 and a jump till 1.4000 is possible.

The near term major support is around 1.34600 (23.6% fib) and any violation below targets 1.3300/1.3160. the pair should break below 1.31600 for minor weakness.

It is good to buy on dips around 1.3550 with SL around 1.34500 for the TP of 1.400.