USD/CAD clings to goodish recovery gains, just above mid-1.2900s
| • A modest USD rebound helped find decent support ahead of 1.2900 handle.
• The up-move seemed rather unaffected by some renewed pickup in oil prices.
• Today’s US/Canadian data might provide some impetus ahead of FOMC minutes.
The USD/CAD pair regained positive traction on Wednesday and recovered a part of the previous session's sharp fall to over one-week lows.
The pair extended last week's rejection slide from 100-day SMA and kept losing ground for the fourth consecutive session on Tuesday. The Bank of Canada's Business Outlook Survey, released on Monday, continued underpinning the Canadian Dollar and kept exerting downward pressure on the major.
However, a late US Dollar rebound, which extended through the Asian session on Wednesday, helped find decent support ahead of the 1.2900 handle and was seen as one of the key factors driving the pair higher.
Meanwhile, a positive tone around crude oil prices, which tend to underpin demand for the commodity-linked currency - Loonie, might now contribute towards capping any meaningful up-move, at least for the time being.
Moving ahead, today's economic docket, featuring the release of US housing market data and Canadian Manufacturing Sales, will now be looked upon for some short-term trading opportunities during the early North-American session.
The key focus, however, will be on the latest FOMC meeting minutes, which might influence Fed rate hike expectations and influence the near-term USD price-dynamics, and eventually provide a meaningful directional impetus.
Technical levels to watch
Any subsequent up-move beyond 1.2970 level is likely to confront stiff resistance near the key 1.30 psychological mark, above which the pair is likely to accelerate the momentum towards 1.3040-45 supply zone.
On the flip side, the 1.2935 level now seems to protect the immediate downside, which if broken might turn the pair vulnerable to head towards the very important 200-day SMA support near the 1.2900-1.2895 region.
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