USD/CAD consolidated near weekly tops, just above mid-1.2800s

Haresh Menghani FXStreet

• Struggles to build on cautious BOC-led up-move.
• Positive oil prices offset persistent USD strength.
• US monthly jobs data holds the key.

The USD/CAD pair oscillated in a narrow trading range through the early European session and was consolidating overnight gains to weekly tops.

On Thursday, the pair extended its recovery move from 6-week lows, touched earlier this week, and got an additional boost after the Bank of Canada (BOC) tames expectations for an imminent rate hike.

The central bank's cautious outlook helped the pair to build on previous session's strong up-move, led by upbeat ADP report on the US private sector employment, and jump back above the 1.2800 handle.

Meanwhile, a combination of diverging factors failed to provide any fresh impetus, with the pair struggling for a firm direction on the last trading day of the week. A strong follow-through US Dollar buying interest being offset by positive trading sentiment around crude oil prices, which tends to underpin the commodity-linked Loonie, and has eventually led to a subdued/range-bound trading action.

Later during the NA session, the keenly watched US monthly jobs report, popularly known as NFP, would now be looked upon for some fresh directional impetus ahead of next week's FOMC meeting.

Technical levels to watch

Any subsequent up-move is likely to confront immediate hurdle near the 1.2900 handle, above which the pair could easily surpass 1.2915-20 supply zone and head towards testing the very important 200-day SMA hurdle near the 1.2955 region.

On the flip side, 1.2830 level no seems to protect the immediate downside, which if broken could drag the pair back below the 1.2800 handle towards its next major support near mid-1.2700s.

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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