USD/CAD clings to gains near 1.3430 despite broad USD weakness

BoC Governor Poloz says bank is ready to cut rates further if needed.
US Dollar Index slumps to two-month lows below 97 on plummeting T-bond yields.
WTI erases more than 2%, trades around $46.

Eren Sengezer FXStreet

The USD/CAD pair erased its gains during the American trading hours and dropped below the 1.3400 handle but didn't have a difficult time regaining traction as falling crude oil prices and Bank of Canada Governor Poloz's comments weighed on the CAD. As of writing, the pair was up 0.35% on a daily basis at 1.3430.

Poloz leaves the door open for additional rate cuts

Commenting on the BoC decision to cut the policy rate by 50 basis points to 1.25% on March 4th, Poloz said the Canadian economy could be seriously tested by the coronavirus outbreak and added that the bank is ready to cut rates further if needed.

"Monetary policy can contribute by buffering effects of outbreak on consumer and business confidence," Poloz added. "This contribution can be particularly powerful when the shock is global, and the response is coordinated."

In the meantime, OPEC+ failed to reach an agreement on additional output cuts on Thursday and this development triggered a fresh crude oil selloff. The barrel of West Texas Intermediate was last seen trading near the $46 mark, erasing more than 2% on a daily basis.

On the other hand, the 10-year US Treasury bond yield slumped to a fresh all-time low by losing, once again, nearly 15% on a daily basis and caused the greenback to weaken against its rivals. With the US Dollar Index dropping to its lowest level in two months at 96.75, the pair seems to be struggling to push higher in the session.

Friday's economic calendar will feature labour market data from both the US and Canada.

Technical levels to watch for

USD/CAD

Overview
Today last price	1.3422
Today Daily Change	0.0028
Today Daily Change %	0.21
Today daily open	1.3394

Trends
Daily SMA20	1.3299
Daily SMA50	1.318
Daily SMA100	1.3185
Daily SMA200	1.321

Levels
Previous Daily High	1.3432
Previous Daily Low	1.333
Previous Weekly High	1.3465
Previous Weekly Low	1.3225
Previous Monthly High	1.3465
Previous Monthly Low	1.3202
Daily Fibonacci 38.2%	1.3393
Daily Fibonacci 61.8%	1.3369
Daily Pivot Point S1	1.3339
Daily Pivot Point S2	1.3284
Daily Pivot Point S3	1.3238
Daily Pivot Point R1	1.344
Daily Pivot Point R2	1.3486
Daily Pivot Point R3	1.3541

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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