The GBP/CAD cross surged to a fresh weekly high of 1.8978, helped by a steep recovery in the pound, which was for the most corrective, after the overextended decline seen over the past few days.
The Canadian dollar managed to hold ground, despite oil market turmoil, as the commodity first advanced to fresh highs, but later eased on the back of a strong increase in US stockpiles, well beyond expected. According to the EIA report, crude inventories rose by 10.4 million barrels to a total of 518 million barrels, almost three times the 3.6 million-barrel increase expected by analysts.
Having peaked at 1.8979 during the American session, GBP/CAD closed the day at 1.8883, posting a % gain.
GBP/CAD technical outlook
“From a technical point of view, the 1 hour chart shows that the price has managed to advance above a bullish 20 SMA, but also that the technical indicators have lost upward steam near overbought territory, suggesting a possible decline for the upcoming hours,” said Valeria Bednarik, chief analyst at FXStreet. “In the 4 hours chart, however, a slight bullish tone prevails given that the price is above a flat 20 SMA, while the technical indicators head slightly higher above their mid-lines.”
Support levels: 1.8860 1.8800 1.8745. Resistance levels: 1.8940 1.8990 1.9035.
(Market News Provided by FXstreet)