Oil prices have been gliding higher since November, up 85 percent to about $75 a barrel for Brent crude, as global economies begin to consume more oil while OPEC Plus keeps a tight leash on output. OPEC is set to meet this Wednesday to discuss increasing the supply as economies continue to reopen. Bare in mind the Delta variant is spreading more rapidly with UK and Australia extending their lockdowns. This may put a damper on oil output and thus add some bearish strength to the CAD.
All eyes look towards this Friday's NFP report and if we see an increase in new jobs plus a drop in the unemployment rate, the above illustrated trajectory on the chart will become a likely scenario on the daily time-frame.
On the other hand, if OPEC comes through with their latest comments about increasing the supply of oil and NFP disappoints, this pair very well could see a sharp reversal.
== TECHNICAL ANALYSIS ==
Daily chart shows that we are now entering the second bullish continuation wave to the upside. The first level of resistance to monitor is around 1.2450 followed by the 1.26 handle. The 1.26 handle may become a difficult level to break as it intersects with the 200 SMA.
For a bearish scenario to play out, we would need a break and hold below the 1.2240, which could then expose 1.2150 for additional downside support.
All eyes look towards this Friday's NFP report and if we see an increase in new jobs plus a drop in the unemployment rate, the above illustrated trajectory on the chart will become a likely scenario on the daily time-frame.
On the other hand, if OPEC comes through with their latest comments about increasing the supply of oil and NFP disappoints, this pair very well could see a sharp reversal.
== TECHNICAL ANALYSIS ==
Daily chart shows that we are now entering the second bullish continuation wave to the upside. The first level of resistance to monitor is around 1.2450 followed by the 1.26 handle. The 1.26 handle may become a difficult level to break as it intersects with the 200 SMA.
For a bearish scenario to play out, we would need a break and hold below the 1.2240, which could then expose 1.2150 for additional downside support.