Strong Canadian dollar on higher oil prices!

As oil prices rose to their highest level since October 2018, the Canadian dollar has been taking an advantage of the rally. Canada is one of the largest exporters of oil in the world. Demand for oil will boost its economy and the demand for the loonie (nickname of the Canadian dollar) as well.

The USDCAD pair is trading tightly under its 50 moving average and a long term descending trendline. Should the loonie continue strengthening, the course could test the previous low at 1.2467 (A), then slide towards the support level around 1.2400, which was formed in January 2018. Breaking above the 50 moving average and the descending trendline would mean, that the American dollar is gaining control over the Canadian dollar and the long term trend could change in favor of the USD.

Resistance levels around 1.2860 (B) and 1.3340 (C) could halt the greenback´s advance and show us, whether the change in trend could continue.