USD/CAD - US dollar-Canadian dollar, daily - 12/11/2023 (GMT)

Negativity on the greenback in the last few weeks as the Fed’s expected pivot began to be plotted much earlier has given way in the last few sessions to renewed strength in various pairs including USDCAD. Oil meanwhile has made very strong losses this week, with American light oil reaching five-month lows below $70 a barrel. TA seems to support the positive impression from fundamentals for dollar-loonie.

The current bounce originated slightly above the key support from the 23.6% weekly Fibonacci retracement around $1.345, which was also the limit of September’s retracement. The slow stochastic has completed a crossover within oversold.

However, the price is now approaching the 20-day  and 100-day moving averages, so it might be difficult to break above there without a significant catalyst from the NFP. Apart from the job report later today, next week there’s also American inflation on Tuesday plus Wednesday’s meeting of the Fed, which is crucial for hints on how long the funds rate might stay at 5.25-5.5%. This is a very busy few days of data from the USA: volatility for USDCAD and other majors with the US dollar might increase significantly.