USD/CAD bounces from 1.3300 as crude oil losses momentum
- CAD losses strength as crude oil and equity prices retreat.
- USD/CAD holds a bearish tone but unable to break 1.3300.
The USD/CAD pair is falling on Wednesday on the back of an improvement in risk sentiment that weakened the demand for the US dollar. “There is a positive tone in the financial markets on the back of trade optimism and improvement in China’s growth outlook. Both equity and sovereign bond yields increased across the board, suggesting a decline in global risk premium”, said BBVA analysts.
During the European session, the pair bottomed at 1.3294, the lowest level in almost two weeks. It quickly rose back above 1.3300, and after the beginning of the US session climbed to 1.3340.
As of writing was trading at 1.3325, down 15 pips for the day. The Loonie lost strength after reaching a strong support and also amid a retreat in equity prices in Wall Street and in crude oil. The WTI barrel erased gains, and it was falling 0.60%, after hitting earlier fresh multi-month highs near $63.00. The Dow Jones was up marginally, far from the highs.
Regarding economic data, US numbers came in mixed on Wednesday (deceleration in the service sector and lower-than-expected private employment for March). The next key report in the US will be on Friday with the NFP. In Canada, on Thursday, the Ivey PMI is due tomorrow and on Friday jobs numbers.
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Author
Matías Salord
FXStreet
Matías started in financial markets in 2008, after graduating in Economics. He was trained in chart analysis and then became an educator. He also studied Journalism. He started writing analyses for specialized websites before joining FXStreet.
