USD/CAD stuck in a range above 1.25 mark, US ISM/FOMC minutes awaited
| • Stalls its recent bearish slide, finds support near 1.25 handle.
• Bullish oil prices offset goodish USD rebound and cap gains.
• US ISM PMI and FOMC minutes eyed for fresh impetus.
The USD/CAD pair prolonged its consolidative price-action and was seen oscillating within 20-25 pips narrow trading range.
The pair stalled its recent downslide from levels beyond the 1.2900 handle and now seems to have found some decent support near the key 1.2500 psychological mark. However, a combination of diverging forces failed to assist the pair to register any meaningful recovery from its lowest level since Oct. 20.
A goodish pickup in the US Dollar demand remained supportive of the pair's modest uptick, albeit the positive effect, to some extent, was being negated by the prevalent bullish sentiment around crude oil prices, which tends to lend support to the commodity-linked currency - Loonie.
Adding to this, a weaker tone around the US Treasury bond yields also seems to contribute towards keeping a lid on the pair's recovery attempt. Traders now look forward to the US economic docket, featuring the release of ISM manufacturing PMI and December FOMC meeting minutes, for some fresh impetus.
Technical levels to watch
On a sustained move above 1.2530 level, the pair seems more likely to surpass an intermediate resistance near 1.2565-70 zone and head towards testing 100-day SMA barrier near the 1.2600 handle. Alternatively, a clear break through the 1.25 handle is likely to accelerate the downfall towards 1.2450-45 horizontal zone en-route 1.2415-10 support.
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