USD/CAD consolidates in a range, above mid-1.3400s ahead of US/Canadian macro data

   •  Weaker oil prices undermine Loonie and helped regain some positive traction.
   •  Sliding US bond yields/subdued USD demand do little to provide an additional boost.
   •  Investors await Wednesday’s important macro releases from the US and Canada. 

The USD/CAD pair regained some positive traction on Wednesday, albeit remained well within a broader trading range held over the past one week or so.

Weaker Oil prices, pressurized by the overnight API data that showed a surprise rise in the US crude stockpiles, turned out to be one of the key factors weighing on the commodity-linked currency and provided a minor lift to the major. 

Adding to this, the IEA slashed global oil demand forecast for the first time since October and made it even more difficult for Oil to recover, albeit a subdued US Dollar price action kept a lid on any strong follow-through momentum.

As investors still absorb shocks from the recent escalation in the US-China trade tension, a fresh leg of a downfall in the US Treasury bond yields held the USD bulls on the defensive through the early European trading session on Wednesday.

Moreover, investors also seemed reluctant to place any aggressive bets ahead of Wednesday’s important macro releases – US monthly retail sales data and the latest Canadian consumer inflation figures, due later during the early North-American session.

Hence, it would be prudent to wait for a sustained move beyond the recent trading range barrier near the key 1.3500 psychological mark before traders start positioning aggressively for any further near-term appreciating move.

Technical levels to watch