USD/CAD: technicals are bullish for progress to key 1.3280

USD/CAD has been better bid since 1.3066 and rallied from 1.3115 today to score 1.3197 and just above previous 30th Sep high of 1.3195.

The US dollar is broadly strong this week while bulls were encouraged by the improvement in the U.S. manufacturing PMI's back above 50 and the hawkish rhetoric of Fed speakers this week so far. Oil, on the other hand has also rallied onto $49bbls WTI that may prevent a full on break out through the 1.32 handle in USD/CAD.

USD/CAD levels

USD/CAD is above key moving averages, but needs to break through 1.3280 to offer any conviction in a continuation of the recovery drift from lows of 1.2460 back in May earlier this year. "The broader, multi-month ascending trend channel is holding, with a sequence of higher lows and higher highs from May," explained analysts at Scotiabank, adding, "We continue to look to USD/CAD gains toward the 1.33-1.35 area."