FxWirePro: USD/CAD upside capped by 55- day EMA, good to sell on rallies

• USD/CAD continuing its weakness for third consecutive days almost 235 pips after hitting high of 1.26880. The pair hits intraday low of 1.24506. The decline in prices was due to sudden spike in crude oil prices and weakness in US equity markets. It is currently trading around 1.24680.
   
• US PPI came at 0.4% for the Jan month in line with estimate. The pair shown a 75 pips jump till 1.25373 after release of data. But that jump was used as good selling opportunity by traders and declined almost 88 pips from the high.
   
• Oil prices has shown a good recovery from the low of $58.05. Crude oil prices has shown a good recovery after a minor decline till $59.80 level. The commodity has broken previous day high of 61.51 and jumped till $61.80. The upside is limited as US crude production notched a record 10.25 mbpd last week.      
         
• On the higher side, major resistance is around 1.25350 and any break above will take the pair till 1.2600/1.26490/1.26880.
   
• The near term support is around 1.2450 (50% fibo) and any break below will take the pair till 1.2435/1.2355. Overall bearish continuation only below 1.2245.

It is good to sell on rallies around 1.2535-40 with SL around 1.2645 for the TP of 1.2500/1.2435.