USD/CAD tests key 20-DMA support as Oil turns positive

The CAD bulls are seen retaining control amid a recovery in oil prices during the European session, knocking-off USD/CAD near session lows.

USD/CAD supported near 10-DMA at 1.3477

Currently, the USD/CAD pair is last seen exchanging hands at 1.3471, down -0.32% so far, consolidating the Asian sell-off before the next leg lower. The Loonie benefits from a minor-rebound staged by oil prices, after renewed optimism spread across the markets, with traders now hoping once again that an OPEC output deal will be clinched on Wednesday.

According to the latest headlines, as cited by FT sources, Saudi Arabia has offered to cut 4.5% from production levels of 10.5mln BPD, pressurizing Iran and Iraq to accept larger share of production cuts. While Goldman Sachs also noted that an OPEC deal on Nov. 30 looks more likely than before.

Moreover, broad based US dollar correction also acts as a drag on the USD/CAD pair. The USD index, which measures greenback’s relative performance against a basket of six major currencies, drops to 101.12, down -0.36% on the day, having faded a spike to 101.20 last hour.

USD/CAD Technical Levels

To the upside, the next resistances are seen near 1.3523 (daily high) and 1.3566 (Nov 18 high) and from there to 1.3590 (Nov 14 high). To the downside, immediate support might be located at 1.3450 (psychological levels/ Nov 25 low) and below that at 1.3400 (zero figure) and at 1.3374 (Nov 22 low).

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