The US dollar is asserting broad strength in Monday’s Asian session, pushing USD/CAD above the mid-1.3700s โ just below a one-month high hit last Friday. The Canadian dollar is under pressure but finding partial support from rising crude oil prices, which typically benefit commodity-linked currencies like the CAD and, to a lesser extent, the AUD.
For Australian traders, the USD/CAD move is a useful proxy for overall US dollar momentum. When the greenback is strengthening against commodity currencies like the CAD, it often signals parallel pressure on AUD/USD โ both are resource-linked currencies sensitive to global risk appetite and commodity flows.
The USD’s bullish tone during the Asian session on Monday suggests markets are maintaining a cautious stance heading into the new week. Rising oil prices are providing a partial floor under the CAD, but have not been enough to reverse the currency’s one-month low against the dollar. Australia’s iron ore and energy export dependency means a sustained USD rally typically weighs on the AUD in a similar fashion.
What Australian Traders Should Watch
- AUD/USD support levels: Broad USD strength is a headwind โ watch how AUD/USD holds if the dollar continues to rally through the week.
- Commodity prices: Rising oil is cushioning CAD; iron ore and gold price direction will be the comparable buffer (or drag) for AUD.
- US macro calendar: Any US data surprises this week could extend USD momentum, adding further pressure across commodity currencies including AUD.
The directional bias for commodity currencies is wait-and-see. USD strength is real but the commodity price support is acting as a counterweight โ Australian traders should avoid leaning too hard in either direction until clearer US macro signals emerge mid-week.
Source: FX Street