Price movements on the chart of the USD/CAD currency pair were flat at the opening of the week as investors were wary of gloomy developments in the global crude oil market which could potentially have a weakening effect on the Canadian dollar.
Following the spread of Covid-19 in China with reports of movement restrictions being re-implemented in Wuhan, concerns have been raised about the demand for crude oil.
At the end of this week, the Canadian jobs data report will be the focus to drive the movement of the Loonie which is published along with the United States (US) NFP report.
The US dollar has received an injection of restrengthening after the release of US economic growth data at the end of last week, but investors are likely to take precautions awaiting the results of the FOMC meeting and the NFP report.
If examined, the price on the USD/CAD chart in the past week has shown a decline to lower levels until reaching the latest support level at 1.35000.
However, at the end of the week, it showed a more horizontal movement before investors judged that there was a sign for the price to change direction again.
On Friday, the price showed an uptrend and broke above the Moving Average 50 (MA50) barrier level on the 1-hour time frame on the USD/CAD chart, giving an early signal for a bullish trend change.
Continuing the movement above the MA50 level earlier this week, analysts expect rate hikes to continue if the US dollar succeeds in strengthening.
However, the price needs to pass the SBR (support become resistance) zone of 1.36400 which was still tested at the beginning of the European session this afternoon before continuing to rise higher.
The target of the continued increase is at the height zone of 1.38000 which was a resistance in the previous weeks trading.
