USD/CAD flirts with session lows, around 1.2520-15 region

USD/CAD edged lower on Wednesday and extended the overnight pullback from one-week tops.
Dovish Fed expectations continued acting as a headwind for the USD and exerted some pressure.
A softer tone around oil prices undermined the loonie and might help limit any meaningful slide.

Haresh Menghani FXStreet

The USD/CAD pair remained on the defensive through the early European session and was last seen trading with modest losses, around the 1.2520-15 region.

The pair edged lower during the early part of the trading action on Wednesday and moved further away from one-week lows, around the 1.2575 region touched in the previous session. The downtick was exclusively sponsored by a modest US dollar weakness, though lacked any follow-through selling.

Investors now seem convinced that the Fed will retain its ultra-lose monetary policy stance for a longer period. This, in turn, continued acting as a headwind for the greenback and exerted some pressure on the USD/CAD pair. That said, a combination of factors helped limit the downside.

Concerns that the fast-spreading Delta variant of the coronavirus could derail the global economic recovery acted as a tailwind for the safe-haven USD. Apart from this, a softer tone surrounding oil prices undermined the commodity-linked loonie and extended some support to the USD/CAD pair.

Worries that the continuous rise in new COVID-19 cases will limit fuel demand weighed on crude oil prices. However, geopolitical tensions in the Gulf, along with the overnight bullish report from the American Petroleum Institute, for now, seemed to have offset the demand concerns.

Market participants now look forward to the US economic docket, featuring the releases of the ADP report and ISM Services PMI. Traders will also take cues from the official Energy Information Administration (EIA) report on US oil inventories for some opportunities around the USD/CAD pair.

Technical levels to watch

USD/CAD

Overview
Today last price	1.2525
Today Daily Change	-0.0012
Today Daily Change %	-0.10
Today daily open	1.2537

Trends
Daily SMA20	1.2545
Daily SMA50	1.2356
Daily SMA100	1.237
Daily SMA200	1.2591

Levels
Previous Daily High	1.2576
Previous Daily Low	1.249
Previous Weekly High	1.2605
Previous Weekly Low	1.2422
Previous Monthly High	1.2808
Previous Monthly Low	1.2303
Daily Fibonacci 38.2%	1.2543
Daily Fibonacci 61.8%	1.2523
Daily Pivot Point S1	1.2492
Daily Pivot Point S2	1.2448
Daily Pivot Point S3	1.2406
Daily Pivot Point R1	1.2578
Daily Pivot Point R2	1.262
Daily Pivot Point R3	1.2664

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

EUR/USD trims gains, back below 1.1800

EUR/USD now loses some upside momentum, returning to the area below the 1.1800 support as the Greenback manages to regain some composure following the SCOTUS-led pullback earlier in the session.

GBP/USD off highs, recedes to the sub-1.3500 area

Following earlier highs north of 1.3500 the figure, GBP/USD now faces some renewed downside pressure, revisiting the 1.3490 zone as the US Dollar manages to regain some upside impulse in the latter part of the NA session on Friday.

Gold climbs to weekly tops, approaches $5,100/oz

Gold keeps the bid tone well in place at the end of the week, now hitting fresh weekly highs and retargeting the key $5,100 mark per troy ounce. The move higher in the yellow metal comes in response to ongoing geopolitical tensions in the Middle East and modest losses in the US Dollar.