USD/CAD finds some support near 1.30 handle

Haresh Menghani FXStreet

• Bullish oil prices exerting downward pressure for the second straight session.
• Resurgent US bond yields ease USD bearish pressure and helped limit downfall.

The USD/CAD pair extended overnight rejection slide from 100-day SMA hurdle and remained under some selling pressure for the second consecutive session.

Against the backdrop of softer than expected US consumer inflation figures, the US President Donald Trump's criticism over the pace of Fed rate hikes prompted some fresh US Dollar selling on Thursday and failed to assist the pair to build on previous session's strong upsurge to two-week tops.

The pair kept losing ground through the early European session on Friday and was further weighed down by a goodish pickup in crude oil prices, which provided a minor boost to the commodity-linked currency - Loonie. However, a fresh wave of an upsurge in the US Treasury bond yields helped ease the USD bearish pressure on Friday and helped to pair to defend the key 1.30 psychological mark, at least for the time being.

Moving ahead, traders now look forward to the release of Prelim UoM Consumer Sentiment, a key highlight from today's relatively thin US economic docket, in order to grab some short-term opportunities on the last day of the week.

Technical levels to watch

On a sustained weakness below the 1.30 handle, the pair is likely to accelerate the fall back towards the 1.2950-40 support area en-route the 1.2900 round figure mark. On the flip side, immediate resistance is now pegged near the 1.3040 horizontal level and is closely followed by the 1.3065 region (100-day SMA), which if cleared should pave the way for an extension of the pair's positive momentum.

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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