USD/CAD recovery stalls ahead of 1.35 mark, retreats back to mid-1.3400s
|Having posted a session high near 1.3475 region, the USD/CAD pair ran through fresh offers and is now headed back to Friday's post-data swing lows.
Currently trading around 1.3445 region, the pair traded with bearish bias for the second straight session against the backdrop of a follow through retracement in the US treasury bond yields. The ongoing pull-back in the bond yields, in wake of Friday's lower than expected US average hourly earnings growth, now seems to undermine the US Dollar demand. This coupled with Friday's upbeat Canadian labor market figures further supported the Canadian dollar and is weighing on the major.
However, a fresh bout of bearish slide in WTI crude oil, which tends to dent demand for the commodity-linked currency - Loonie, has helped the pair to hold above Friday's swing lows near the 1.3420 region.
Technical levels to watch
A follow through weakness below 1.3420 level (Friday’s low) is likely to accelerate the corrective slide further towards 1.3375-70 support before the pair eventually drops to 1.3320-15 support area. On the upside, momentum above session peak resistance near 1.3475 level now seems to assist the pair back towards the 1.35 psychological mark resistance ahead of Thursday’s multi-month tops resistance near 1.3535 level.
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