Crude oil prices are reported to have recovered slightly after experiencing a significant fall to a 3-month low with US WTI oil reaching $71 per barrel while Brent oil fell below $77 per barrel affected by the current crisis.
Restoring the situation when the projection of petroleum exporting countries (OPEC) is strong against demand from China while the market situation is still obscured by the banking crisis in the United States (US).
The sensitive currency of the crude oil market, the Canadian dollar is seen trading stable compared to the US dollar which is now more likely to experience further depreciation.
This is reinforced by the assessment of the US inflation data published in the New York session last night which showed a decrease in the US inflation rate in February.
The Federal Reserve (Fed) is seen to be choosing a path towards policy easing, and expectations for a previous 50 basis point increase in interest rates may be hard to come by.
The price chart of the USD/CAD currency pair, if observed, is displaying a bearish pattern after last week's high of 1.38600.
The price started to decline at the beginning of the week from the 1.38000 level and remained moving below the Moving Average 50 (MA50) barrier on the 1-hour time frame on the USD/CAD chart for a bearish signal.
As of yesterday's New York session and continued trading as of today's European session (Wednesday), the price has entered the price concentration zone around 1.36600.
The RBS (resistance become support) zone has been the target before and the price reaction in the zone will give an indication for further movement.
If it manages to break through lower, the price is seen to go up to the level of 1.35000 after last touching that level on February 21.
However, if the price rises, it is likely that the MA50 barrier will be crossed and give an early signal for a change in trend to occur.
The rise will continue towards the 1.38000 level before testing the height reached last week at 1.38600 again.
