The Canadian dollar was seen as one of the currencies that benefited from the risk of conflict unrest in the Middle East last weekend.
While other major currencies are looking for direction, the Canadian dollar managed to show strengthening due to the impact on the global crude oil market.
The war that broke out between Palestine and Israel has raised concerns about supplies and increased the price of oil in the market.
The upheaval is also seen to push the United States (US) to tighten sanctions on Iran and have a negative impact on Iran's oil exports as the country is believed to have given support to the Hamas militant group that started the attack last Saturday.
On the chart of the USD/CAD currency pair, it is clearly displayed a pattern of falling prices with the bearish movement continuing at the beginning of yesterday's week.
Last Friday, following the reaction to both the US and Canadian jobs reports being published, the price had plunged below the 1.37000 level.
Continuing on Monday yesterday, a daily decline of around 90 pips was recorded and resumed trading today (Tuesday), the price has reached an important level at 1.35700.
Analysts anticipating a reaction to the zone have seen prices bounce back to around 1.36000 as of the early opening of the European session.
However, the price movement which is still below the barrier line of the Moving Average 50 (MA50) in the 1-hour time frame on the USD/CAD chart signals a still bearish trend for prices.
The decline is likely to continue to a lower level if the price drops below 1.35700 which is the current price support level.
The target for the next drop is to head around the 1.35000 zone.
Meanwhile, a price increase that successfully crosses the MA50 barrier will give a new signal for the price to recover to a higher level again.
Passing the zone around 1.36500 will next lead to resistance at 1.37000 again which was successfully broken during last week's decline.
