• A follow-through pullback in oil prices undermine Loonie and provided an additional boost.
• The USD holds steady near 22-month tops and remained supportive of the positive move.
• The key focus will remain on the latest BoC monetary policy update, scheduled later today.
The USD/CAD pair continued gaining positive traction through the early European session on Wednesday and is currently placed at near seven-week tops, just above mid-1.3400s.
A combination of supporting factors continued fueling the positive momentum for the second consecutive session and assisted the pair to build on the overnight bullish break through the 1.3400 handle - the top end of a three-week-old consolidative trading range.
The US Dollar held steady just below 22-month tops set on Tuesday and remained supported by the stronger US housing market data, which added to the recent upbeat retail sales figures and eased concerns of a slowdown in the world's biggest economy.
This coupled with a follow-through pullback in crude oil prices, from fresh 2019 highs touched yesterday, further dented demand for the commodity-linked currency - Loonie and remained supportive of the ongoing positive move to the highest level since March 8.
The Canadian Dollar was further weighed down by growing market conviction that the Bank of Canada (BoC), at its latest monetary policy meeting this Wednesday, may again strike a more cautious tone amid the recent softness in the domestic economy.
The constructive set-up clearly points to an extension of the ongoing positive momentum, even beyond YTD tops, towards reclaiming the key 1.35 psychological mark ahead of this week's more relevant market moving economic releases from the US.
Technical levels to watch
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD retreats toward 1.0850 on modest USD recovery
EUR/USD stays under modest bearish pressure and trades in negative territory at around 1.0850 after closing modestly lower on Thursday. In the absence of macroeconomic data releases, investors will continue to pay close attention to comments from Federal Reserve officials.
GBP/USD holds above 1.2650 following earlier decline
GBP/USD edges higher after falling to a daily low below 1.2650 in the European session on Friday. The US Dollar holds its ground following the selloff seen after April inflation data and makes it difficult for the pair to extend its rebound. Fed policymakers are scheduled to speak later in the day.
Gold climbs to multi-week highs above $2,400
Gold gathered bullish momentum and touched its highest level in nearly a month above $2,400. Although the benchmark 10-year US yield holds steady at around 4.4%, the cautious market stance supports XAU/USD heading into the weekend.
Chainlink social dominance hits six-month peak as LINK extends gains
-637336005550289133_XtraSmall.jpg)
Chainlink (LINK) social dominance increased sharply on Friday, exceeding levels seen in the past six months, along with the token’s price rally that started on Wednesday.
Week ahead: Flash PMIs, UK and Japan CPIs in focus – RBNZ to hold rates
After cool US CPI, attention shifts to UK and Japanese inflation. Flash PMIs will be watched too amid signs of a rebound in Europe. Fed to stay in the spotlight as plethora of speakers, minutes on tap.