GBP/CAD consolidates at 1-year lows

The GBP/CAD cross plummeted to its lowest level in a year, down to 1.8192 late in the US afternoon, as the loonie was underpinned by crude oil prices closing the day at their highest for this 2016.

West Texas Intermediate crude oil surged above $ 42.00 a barrel while Brent futures ended the day at $44.69 a barrel, on news that Russia and Saudi Arabia agreed on an output freeze ahead of the Doha meeting, adding that the final decision will not depend on Iran.

The news boosted the Canadian dollar, up against the greenback to 1.2570, a level last seen in July 2015, while the Pound remained undermined by Brexit fears.

GBP/CAD technical view

“The GBP/CAD 1 hour chart shows that the technical indicators are within extreme oversold readings, with no aims to recovering ground, whilst the price accelerated far below a bearish 20 SMA, all of which maintains the risk towards the downside,” said Valeria Bednarik, chief analyst at FXStreet. “In the 4 hours chart, the 20 SMA kept capping the upside, while the technical indicators hold within bearish territory, lacking clear directional strength as the RSI heads lower, and the Momentum higher.”

Support levels: 1.8175 1.8120 1.8060. Resistance levels: 1.8255 1.8310 1.8380.