Today in the early European trading hours, the USD/CAD currency pair extended its previous session gains and rose to a fresh intra-day high near above 1.4030, mainly due to the uptick in the broad-based U.S. dollar. The weaker oil prices undermined the loonie demand and kept the currency pair higher. At the press time, the USD/CAD currency pair is currently trading at 1.4021 and consolidates in the range between the 1.3939 - 1.4035.
It is worth to mention, China's decision to impose new Hong Kong security law bolstered tensions between the world's two largest economies. As in result, the risk sentiment got damaged and provided support to the greenbacks perceived safe-haven status. In return, President Donald Trump said the United States would react firmly if China imposes the laws, while two U.S. legislators were preparing a bill about imposing bans on entities involved in supporting the law. Furthermore, the Dollar Index was gaining ground against other currencies and rebounded on Thursday from a strong support level of 99 and remained in a range between 99 and 101.
On the other hand, the U.S. dollar's strength from better than expected PMI data from the U.S. drove the pair USD/CAD on an upward trend. The Flash Manufacturing PMI data from the U.S. increased to 39.8 from the forecast of 39.3. The Flash Services PMI was also exceeded from expectations of 32.6 to 36.9 and supported the U.S. dollar. The rebound in Services PMI showed that the economy was improving after the easing of lockdown and reopening of economies.
Pivot Point 1.3938
The USD/CAD is trading with a bullish bias around 1.4015 level, and bullish crossover of 1.2390 level has the potential to lead the USD/CAD prices towards 1.4109 level. On the 4 hour chart, the USD/CAD has formed bullish engulfing candles, which are driving upward in the market, and these may lead the USD/CAD prices further higher. Let's consider taking buy trades over 1.3960 and selling below the same today. Good luck!