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Forex - USD/CAD hits 6-week low as crude oil posts sharp gains

Published 08/02/2010, 06:08 AM
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EUR/CAD
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Investing.com – The U.S. dollar tumbled to a 6-week low against its Canadian counterpart on Monday, as oil prices made sharp gains amid increased risk tolerance.

USD/CAD hit 1.0227 during European morning trade, the pair's lowest since June 22; the pair subsequently consolidated at 1.0232, shedding 0.59%.

The pair was likely to find support at 1.0137, the low of June 21 and resistance at 1.0390, the high of July 29.

Earlier in the day, crude oil prices advanced past USD 79.50 a barrel, hitting their highest level in 4 days, amid speculation that the Chinese government will relax policies aimed at curbing economic growth in the world’s largest energy user.

The Canadian dollar closely tracks crude oil prices as the country is a major oil exporter.

The loonie was also up against the euro, with EUR/CAD shedding 0.44% to hit 1.3376.

Later in the day, the U.S. was to release key manufacturing data, while the Federal Reserve Chairman Ben Bernanke was also to make a speech on the difficulties currently facing the U.S. economy.

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