USD/CAD advances to session tops above 1.32, struggles to push higher as oil recovers

WTI erases daily losses to turn positive above $74.
US Dollar Index steadies below 95.
USD/CAD looks to end the day in the positive territory.

Eren Sengezer FXStreet

The USD/CAD pair broke above the 1.32 mark in the early trading hours of the NA session and touched a new session top at 1.3225 as the upbeat PMI data from the United States help the greenback gather more strength against its rivals. As of writing, the pair was trading at 1.3215, adding 0.62% on the day.

Markit's final PMI report for June showed that the business activity in the manufacturing sector expanded at a faster pace than the report suggested in the previous estimate. Moreover, the ISM Manufacturing PMI improved to 60.2 in June from 58.7 in May to beat the experts' estimate of 58.1. Boosted by these data, the US Dollar Index continued to retrace last Friday's gains and rose to 94.88 before going into a consolidation phase. At the moment, the index is up 0.62% on the day at 94.80.

Meanwhile, after coming under a selling pressure in the early NA session, crude oil staged a modest recovery and allowed the commodity-loonie to limit its losses against peers. The barrel of West Texas Intermediate recently rose above the $74 mark and turned flat for the day.

Canadian markets are closed on Monday due to Canada Day holiday and Markit is going to release the manufacturing PMI data on Tuesday.

Technical levels to consider

On the upside, the initial resistance for the pair could be seen at 1.3225 (daily high) ahead of 1.3265 (Jun. 29 high) and 1.3350 (Jun. 28 high). On the downside, supports align at 1.3125 (Jun. 29 low), 1.3000 (psychological level/50-DMA) and 1.2920 (100-DMA).

Author

Eren Sengezer

FXStreet

As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.

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