December 4, 2022

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Oil reversal lower boosts USD/CAD

1 min read

USD/CAD at the high of the day

WTI crude oil is down to $75.09 from a high of $76.98 as profit-taking cuts nearly $2 from the price of oil.

There has been no fundamental news since the earlier peak but there is plenty of worry about OPEC+ going back to negotiations or cracks in the alliance. The spike higher earlier came after Saudi Arabia boosted prices for customers but it didn’t last.

Oil is certainly overbought with the 14-day RSI over 70 but it’s overcome plenty of negative headlines in the past few weeks with only the thinnest of pullbacks. I anticipate this is some positioning adjustment as the US market goes to work on a new quarter starting today.

The spillover into USD/CAD is evident on the chart and there’s a broader USD bid helping as well. The pair fell as low as 1.2302 but is up to 1.2390.

USD/CAD at the high of the day

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