USD/CAD fell to the low of 1.2428 in the European session. From that level, the pair managed to rebound and is now trading above the 21 SMA with a positive bias. USD/CAD could continue its upward movement in the next few hours.
On the other hand, the loonie could pullback towards weekly support at 1.2475.
The daily pivot point is located at that level and could offer a good technical rebound. If USD/CAD falls towards this level of 1.2475 in the next few hours, it would be an opportunity to buy with targets at 1.2503 and 1.2573.
In the last hours, the price of crude oil is weakening which deprives the Canadian dollar of its support. USD/CAD might extend its upward movement and climb above the psychological level 1.2500.
On the other hand, reports that the US is considering a massive release of up to 180 million barrels of its strategic oil reserve could weaken the strength of the Canadian dollar and it may reach the level of 1.2641 (EMA 200).
Expectations of aggressive monetary tigthening by the US Fed are boosting the US dollar which could open the door to a technical rebound. So, USD/CAD could reach the level 1.3000 in the short term.
OOur trading plan for the next few hours is to buy the Canadian dollar if it consolidates above 1.2503. Alternatively, in case of a pullback towards 1.2475, there will be an opportunity to buy with targets at 1.2573 and 1.2641.
Since March 24, the eagle indicator is giving a positive signal and this could probably favor the upward movement of the Canadian dollar in the coming days.
