USD/CAD firmer, gearing up for a test of 1.3500

Pablo Piovano FXStreet

The greenback stays bid vs. its Canadian counterpart during the second half of the week, now pushing USD/CAD to fresh tops just below 1.3500 the figure.

USD/CAD attention to US releases

The pair is trading just pips away from 6-week tops in the boundaries of the critical barrier at 1.3500 the figure, advancing for the third consecutive session so far and gaining over two cents since last week’s lows around 1.3220.

The better tone from US yields keeps sustaining the up move in spot, while the divergence in policy between the Federal Reserve and the Bank of Canada stays as the almost exclusive driver for the price action.

In the same line, CAD seems to be deriving some selling pressure from the decline in crude oil prices, as the barrel of West Texas Intermediate shed over $3 from last week’s tops around $53.70 to yesterday’s test of the $50.00 neighbourhood, where it seems to have found some dip-buyers.

On the data front, Canadian inflation figures for the month of March are due tomorrow, while Initial Claims and the Philly Fed Manufacturing Index for the month of April are due later in the US calendar.

USD/CAD significant levels

As of writing the pair is gaining 0.01% at 1.3485 facing the immediate resistance at 1.3496 (high Mar.14) seconded by 1.3536 (2017 high Mar.9) and then 1.3601 (high Dec.28 2016). On the other hand, a breakdown of 1.3462 (low Apr.20) would open the door to 1.3369 (20-day sma) and finally 1.3294 (55-day sma).

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

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