Canadian Dollar extends rebound on Gaza-tensions-fueled Crude Oil bounce

• Canadian Dollar sees gains for holiday Monday as Crude Oil catches a bid on Israeli-Hamas conflict concerns.
• Canada markets are dark for Canadian Thanksgiving, in conjunction with the US Columbus Day holiday.
• It’s a quiet week on the economic calendar for the Canadian Loonie, investors to focus on US CPI inflation figures in the back half of the week.

The Canadian Dollar (CAD) is finding some lift on Monday, extending the Loonie’s rebound against the US Dollar (USD). The USD/CAD is trading back into familiar territory after tapping into a seven-month high last week on broad-market risk aversion flows that sent investors piling into the safe haven Greenback.

Canada is taking Monday off for the Thanksgiving national holiday, but geopolitical tensions around the Gaza Strip have sent global markets into an alert state. Crude Oil prices have lept higher on Middle East stability concerns, helping to prop up the oil-backed Loonie.

Daily Digest Market Movers: Canadian Dollar extends gains against the Greenback on Crude boost

• A rocket attack by Hamas claimed over 700 lives in the Gaza Strip over the weekend, prompting Israel to deploy approximately 100,000 additional troops in the region and igniting market concerns about Crude Oil supply destabilization in the Middle East.
• Oil barrel prices spiked on Monday, with West Texas Intermediary (WTI) Crude Oil up over 4% for the day to trade near $86 a barrel.
• The Canadian Dollar is getting pulled upwards (USD/CAD lower) by lifting barrel costs, extending the Loonie’s rebound from last week’s USD/CAD seven-month peak of 1.3785.
• The US Dollar is down around 0.33% against the CAD for Monday.
• The economic calendar is notably thin on the Canadian data side, leaving market flows to focus predominantly on geopolitical issues, as well as inbound US inflation figures due in the latter half of the trading week.
• US Producer Price Index (PPI) and Consumer Price Index (CPI) figures are due on Wednesday and Thursday, respectively.
• The Canadian exchanges are closed for the Canadian Thanksgiving holiday celebrations, further reactions could be expected when Loonie-based markets reopen on Tuesday.

Technical Analysis: Canadian Dollar extends rebound against US Dollar, trading into 1.3620

The USD/CAD is sliding back into the 1.3600 level after clipping a seven-month high of 1.3785 last week and is down 1.2% from that level.

The pair opened the new trading week near 1.3660, only managing to eke out a minor climb to a daily high of 1.3676 before falling back down the charts to trade into the 200-hour Simple Moving Average (SMA) near 1.3630.

The 200-day SMA is holding flat just above 1.3450, and a continued decline in the USD/CAD will see bids set to make a run at the 50-day SMA, which has confirmed a bullish cross of the longer moving average and is rising into the 1.3550 region.