USD/CAD remains in the red near mid-1.25s as WTI looks to end year above $60
- WTI gains traction on Friday and breaks above $60.
- USD/CAD drops more than 150 pips on the week.
- DXY looks to finish 2017 near 92.
On the last trading day of 2017, the USD/CAD pair extended its losses and is headed to close the eighth straight day with losses. As of writing, the pair was trading at 1.2546, losing 0.16% on the day.
Today's fall seems to be the product of a combination of a broad-based USD weakness and a stronger loonie. The commodity-sensitive CAD on Friday gathered strength against its rivals as crude oil was able to build on its recent gains. The barrel of West Texas Intermediate refreshed its highest level in more than five years at $60.32 earlier in the European session and was last seen consolidating its gains near $60, where it was up 0.45% on the day.
On the other hand, the US Dollar Index, which broke below the 92 mark for the first time in three months today, is looking to end the year on a weak note as investors are abandoning the greenback amid uncertainties surrounding the impact of the tax reform on the economic activity and the FOMC's monetary policy strategy in a potentially low inflation environment in 2018.
Technical levels to consider
The pair could face the initial support at 1.2500 (psychological level) before 1.2450 (Oct. 19 low) and 1.2410 (Sep. 29 low). On the flip side, resistances align at 1.2605 (100-DMA), 1.2700 (psychological level) and 1.2765 (50-DMA).