USD/CAD drops back closer to yesterday’s swing low post-Canadian CPI
| • CAD surges after Canadian CPI beats estimates.
• Upbeat US durable goods orders help limit losses.
The USD/CAD pair came under some intense selling pressure during the early NA session and tumbled back closer to previous session's swing lows.
The pair continued with its struggle to move beyond 1.2940-50 supply zone and retreated sharply following the release of hotter-than-expected Canadian consumer inflation figures for the month of February. Stronger headline CPI print was now seen adding pressure on BoC to keep hiking borrowing costs to more normal levels and provided a lift to the Canadian Dollar.
From the US, stronger-than-expected durable goods orders, which followed hawkish comments by Atlanta Fed President Raphael Bostic extended some support to the US Dollar and helped limit further losses, at least for the time being.
The pair quickly rebounded around 25-pips from session lows and is currently trading back around the 1.2860 region, on track to reverse a major part of previous week's strong gains to 9-month tops.
Technical levels to watch
Bears would be eyeing for a clear breakthrough 1.2835-30 support area, below which the pair seems vulnerable to head towards testing the 1.2800 handle. On the upside, the 1.2900 handle might now act as an immediate hurdle, which if cleared could assist the pair to head back towards challenging the 1.2940-50 hurdle.
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