The easing of the situation in the United States and Iraq led to a continuous decline in oil prices, and the pressure on the Canadian dollar pushed the dollar to maintain near 1.3630 volatility against the Canadian dollar.

The US dollar against the Canadian dollar (USD/CAD) was trading around 1.3630 in early Asian trading on Thursday, and the exchange rate temporarily entered the consolidation stage after recording a moderate rise in the previous session. As international crude oil prices fell for the third consecutive day, the Canadian dollar, a commodity currency, came under some pressure, pushing the US dollar to maintain a high level against the Canadian dollar.

As one of the largest crude oil exporters to the United States, the trend of international oil prices usually directly affects the performance of the Canadian dollar. The current WTI crude oil price has fallen to around $95.60 a barrel, and the market's expectation that the situation in the Middle East may ease is weakening the previous oil price support caused by supply risks.

Iran said a ceasefire proposed by the US was "still under consideration" after market reports suggested the US and Tehran could be close to a deal, with the US having submitted a one-page memorandum of understanding that includes the gradual resumption of transport through the Strait of Hormuz and the lifting of the US blockade of Iranian ports, while detailed negotiations on the Iranian nuclear issue will follow.

The Strait of Hormuz is responsible for about 20% of the world's seaborne crude oil transportation, and market expectations for the easing of supply risks in the region have directly depressed the trend of international oil prices.

Meanwhile, US President Donald Trump released tougher rhetoric. Trump said that if Iran rejects the peace deal,DepuThe US would launch a "more intense" military operation, although Mr. Trump also stressed that it "could end" if Iran accepted the terms of the deal that had been discussed.

The current market consensus is that, while the situation in the Middle East remains highly uncertain, the signals that the two sides are willing to continue negotiations have eased market concerns about global energy supply disruptions to some extent.

For the Canadian dollar, the decline in oil prices usually means that export revenue and energy industry support are weakened, so the Canadian dollar is under pressure in the short term. After the recent decline in international oil prices from high levels, the overall performance of commodity currencies is weak, and the US dollar has gained some support against the Canadian dollar.

However, there are also constraints on the dollar. As market expectations of easing global inflationary pressures heat up, investors are starting to bet that the Federal Reserve may cut interest rates early rather than maintain a high interest rate policy for a long time.

Market expectations for the Federal Reserve to cut interest rates have increased, limiting the room for further gains in the dollar index.

The current market focus has gradually shifted to the upcoming US employment data. If the US labor market continues to remain strong, it may drive the dollar back to strength and further support the dollar against the Canadian dollar. But if the data is weak, it may strengthen market expectations for the Federal Reserve to cut interest rates, thereby suppressing the dollar's performance.

From a technical point of view, the dollar against the Canadian dollar daily level as a whole still maintains a strong volatile structure. The exchange rate has recently recovered after gaining significant support near 1.3600, indicating that short-term buying power still exists.The vicinity of 1.3660 has become a key resistance area in the current short-termIf there is a subsequent effective breakout, the exchange rate may further test the 1.3700 and 1.3745 areas.

From below, 1.3600 has formed the first important support level. If it loses this area, it may further step back near 1.3570. The daily MACD indicator is still running above the zero axis, but the upward momentum has slowed down, indicating that the market has entered a high consolidation stage in the short term.

The 4-hour cycle shows that the dollar/Canadian dollar moving average system maintains a slight upward divergence, and the RSI indicator is in the neutral and strong area, indicating that the short-term market sentiment is still biased towards the dollar side. However, as the market waits for US employment data and further news on the situation in the Middle East, the exchange rate may maintain a range-bound trend in the short term.

edit summary

The current trend of the US dollar against the Canadian dollar is mainly affected by the dual factors of "falling international oil prices" and "Federal Reserve interest rate cut expectations". In the short term, if the situation in the Middle East continues to ease, international oil prices may come under further pressure, thereby weakening the performance of the Canadian dollar and supporting the US dollar to maintain a high level against the Canadian dollar. However, if the US economic data weakens and strengthens the Federal Reserve's interest rate cut expectations, the room for the dollar to rise may be limited. In the future, the market needs to focus on the progress of the Middle East situation, changes in international oil prices and the impact of US employment data on market