Oil is down -$3.50 but USDCAD is lower by -1.34% (CAD is higher). | Forexlive

Riddle me this…

Why is the CAD higher if the price of oil is down sharply?

The CAD usually moves lower (USDCAD higher) with lower oil. Now that may not always be the case of course, but with oil a prize commodity, the Pavlovian reaction from traders is oil down, CAD down (USDCAD up).

The price of crude oil fell from over $81 yesterday to a low of $72.94 today (currently trades near the low at $73.58). Yet the USDCAD is trading to a new low and is down -1.34% today (CAD higher). HMMMM.

Looking at the hourly chart the price is testing the lows from last week down to 1.3483. Below that, the rising 100 day MA comes in at 1.34558. The price has not traded below the 100 day MA since back in August 2022.

Will buyers lean against the lows/100 day MA?

If so, a move back above 1.3510 would be eyed to take some of the technical pressure off.