USD/CAD finds resistance near 1.4100, returns to 1.4070 area
- WTI extends slide to $22.50 area on Friday.
- US Dollar Index erases early losses, turns flat near 99.50.
- UoM Consumer Confidence Index in US is expected to drop to 90 in March.
The USD/CAD pair erased nearly 80 pips on Thursday and staged a technical correction on Friday. However, the pair struggled to hold above the 1.4100 handle and was last seen trading at 1.4071, adding 0.4% on a daily basis.
Crude oil selloff limits CAD's gains
Concerns over a sharp fall in global energy demand amid worldwide lockdowns continue to weigh on crude oil prices. After International Energy Agency (IEA) chief Fatih Birol said that the global crude oil demand was expected to drop as much as 20% in 2020, the barrel of West Texas Intermediate (WTI) erased 4.7% on Thursday and extended its slide to weigh on the commodity-sensitive CAD. At the moment, the WTI is down 3% on the day at $22.50.
On the other hand, the broad-based USD weakness made it difficult for the pair to push higher. However, with the US Dollar Index rebounding to 99.50 area from the 10-day low that it set at 98.84 earlier in the day, the pair stays in the positive territory.
There won't be any macroeconomic data releases from Canada in the remainder of the day. The US economic docket will feature the annual core PCE Price Index, the Fed's preferred gauge of inflation, and the University of Michigan's Consumer Confidence Index, which is expected to drop to 90 in March from 95.9.
Technical levels to watch for
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.
