USD/CAD is likely to trade in a lower range today after hitting a near-three-month high of 1.2633 on Thursday. CAD sentiment is boosted by a rise in the Canadaian RBC manufacturing PMI to 51.3 in June from 49.8 in May. USD/CAD is also weighed by weaker sentiment towards the US dollar (ICE spot dollar index last 96.11 versus 96.32 early Thursday). But USD/CAD losses are tempered by lower crude oil prices (Nymex crude hit two-month low $56.40/bbl on Globex this morning; last down 37 cents at $56.56/bbl) and diminished investor risk appetite.
Technical comment:
The daily chart is mixed as the MACD is bullish, five-day moving average is above 15-day moving average and us advancing but stochastics is turning bearish at overbought levels.
Trading recommendations:
The pair is trading below its pivot point. It is likely to trade in a lower range as long as it remains below the pivot point. Short positions are recommended with the first target at 1.2510. A break of that target will move the pair further downwards to 1.2470. The pivot point stands at 1.2595. In case the price moves in the opposite direction and bounces back from the support level, it will move above its pivot point. It is likely to mo ve further to the upside. According to that scenario, long positions are recommended with the first target at 1.2630 and the second target at 1.2670.
Resistance levels: 1.2630 1.2670 1.27
Support levels: 1.2510 1.2470 1.2450
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