USD/CAD extends daily upside toward 1.3700 on USD strength
|- USD/CAD pair gained traction after spending the Asian session near 1.3650.
- US Dollar Index climbed to its highest level since early June.
- WTI fails to hold above $40, loses around 1% on Tuesday.
The USD/CAD pair closed the first day of the week modestly lower and spent the Asian session trading sideways around mid-1.3600s on Tuesday. With the greenback starting to gather strength in the European trading hours, the pair gained traction and rose to 1.3700. As of writing, the pair was up 0.17% on the day at 1.3680.
The broad-based USD strength and the uninspiring performance of crude oil prices seem to be helping USD/CAD push higher in the session.
Eyes on Powell testimony, Canada GDP data
The US Dollar Index, which ended the day virtually unchanged near 97.50 on Monday, rose to its highest level since early June and was last seen gaining 0.22% on the day at 97.68. In the second half of the day, FOMC Chairman Jerome Powell and Treasury Secretary Steven Mnuchin will testify before the US House of Representatives Financial Services Committee.
Moreover, the Conference Board's Consumer Confidence Index and the ISM Chicago's PMI will be featured in the US economic docket.
On the other hand, the barrel of West Texas (WTI) Intermediate failed to make a decisive break above $40 on Monday and turned south on Tuesday. At the moment, the WTI is down 1.2% on the day at $39.10, making it difficult for the commodity-related loonie to show resilience against the USD.
Later in the day, Statistics Canada will release the GDP data for April, which is expected to show a 13% contraction in the economic activity.
Technical levels to watch for
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