USD/CAD climbs above 1.2500 amid renewed USD strength
- USD/CAD gains traction following a quiet start to the week.
- US Dollar Index extends rebound after closing the previous two trading days lower.
- WTI is down nearly 2% on a daily basis, trades below $73.50.
After advancing to its strongest level in more than two months at 1.2558 on Thursday, the USD/CAD pair lost nearly 100 pips on Friday and snapped a four-day winning streak. The upbeat jobs report from Canada, which showed that the Net Change in Employment increased by more than 230,000 to beat the market expectation of 195,000, helped the loonie find demand ahead of the weekend.
Following a quiet start to the week on Monday, however, USD/CAD regained its traction and was last seen trading at a fresh session high of 1.2508, up 0.5% on a daily basis.
WTI declines toward $73 on Monday
The combination of falling crude oil prices and renewed USD strength seems to be fueling USD/CAD upside on Monday.
The US Dollar Index, which lost more than 0.5% in the second half of the previous week, is currently rising 0.23% on the day at 92.30. On the other hand, the barrel of West Texas Intermediate (WTI) is losing nearly 2% at $73.30.
There won't be any high-tier macroeconomic data releases from the US or Canada in the remainder of the day and USD/CAD is likely to continue to react to fluctuations in oil prices and the USD's market valuation. On Tuesday, June Consumer Price Index (CPI) data from the US will be watched closely by market participants.
Meanwhile, the S&P Futures are down 0.3%, suggesting that the greenback could preserve its strength in the second half of the day if the market mood remains cautious.
Technical levels to watch for
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.
