USD/CAD spikes to fresh 1-year tops, near mid-1.3200s
| • The recent USD upsurge seemed unaffected by escalating US-China trade tensions.
• Retracing oil prices weigh on the commodity-linked Loonie and provide an additional boost.
The USD/CAD pair caught some fresh bids on Tuesday and jumped to fresh near one-year tops, closer to mid-1.3200s in the last hour.
After yesterday's good two-way moves, the pair regained positive traction and the latest leg of up-move over the past few hours could be attributed to a sudden pickup in the US Dollar demand.
Despite escalating US-China trade tensions and the ongoing slump in the US Treasury bond yields, the recent USD bullish run remained unabated and was seen one of the key factors driving the pair higher through the early European session.
Adding to this, a sharp fall in crude oil prices undermined demand for the commodity-linked currency - Loonie and further collaborated to the pair's up-move to the highest level since June 27, 2017.
It would now be interesting to see if bulls are able to maintain their dominant position or opt to take some profits off the table as short-term technical indicators approach overbought territory.
Moving ahead, this week's Canadian macro data - consumer inflation figures and monthly retail sales, and the forthcoming crucial OPEC meeting will play an important role in determining the pair's next leg of directional move. In the meantime, today's release of the US housing market data would be looked upon to grab some short-term trading opportunities.
Technical levels to watch
Immediate resistance is pegged near the 1.3265-70 region, above which the pair seems all set to aim towards reclaiming the 1.3300 handle. On the flip side, the 1.3200 handle now seems to protect the immediate downside and is followed by support near the 1.3160-55 region.
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