The pair recovers from Thursday’s drop as lower crude prices and Fed rate hike bets lift the USD, offsetting US-Iran deal optimism.
The USD/CAD pair regained ground in Asian trading Friday, halting a sharp pullback from 1.3870, its highest since April 13. Prices remained below 1.3800 amid mixed signals over a potential US-Iran ceasefire extension, which weighed on oil markets and supported the Loonie-linked pair.
Crude prices hovered near a one-month low after reports of a draft 60-day truce between Washington and Tehran. However, unresolved disputes over Iran’s nuclear program and the Strait of Hormuz capped gains. Meanwhile, expectations of a Fed rate hike by year-end bolstered USD demand, further lifting the pair.
Technically, the pair fell below the 23.6% Fibonacci retracement of its recent rally but retained a bullish bias, with RSI near 57 and MACD in positive territory.