USD/CAD continues to trade at weekly highs near 1.3050

ADP data shows strong employment growth in Canada.
WTI loses around 2% on a daily basis.
US Dollar Index stays in the positive territory.

Eren Sengezer FXStreet

After edging down to the 1.3030 mark during the European trading hours, the USD/CAD pair gained traction and rose toward mid-1.30s as crude oil extended its slide to continue to hurt the demand for the greenback. As of writing, the pair was up 0.2% on the day at 1.3045.

Dragged lower by the sharp increase seen in the U.S. crude oil inventories, the barrel of West Texas Intermediate settled below the critical $70 mark for the first time in a month on Thursday and remained under pressure today. At the moment, the WTI is losing 2% on the day at $68.60.

Although the data released by the ADP showed that the total number of employed in the private sector in Canada increased by 28,800 in September following August's 13,600 growth, the loonie struggled to make a meaningful recovery. On the other hand, today's data from the U.S. showed that the Philly Fed Manufacturing Index eased to 22 but beat the market expectation of 20 and the weekly jobless claims dropped to 210K to help the US Dollar Index stay in the positive territory above 95.70.

There won't be any macroeconomic data releases in the remainder of the day. Later in the session, FOMC member Quarles will be delivering a speech.

Technical levels to consider

The first technical resistance for the pair could be seen at 1.3060 (100-DMA) ahead of 1.3100 (Sep. 3 high) and 1.3200 (psychological level/Sep. 4 high). On the downside, supports are located at 1.3000 (psychological level/50-DMA), 1.2970 (200-DMA) and 1.2915 (Oct. 16 low).

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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