USD/CAD holds steady above 1.2500 mark, lacks follow-through


  • USD/CAD edged higher for the third successive session on Tuesday.
  • A subdued USD demand capped gains amid a modest uptick in oil.

The USD/CAD pair held on to its modest intraday gains above the key 1.2500 psychological mark through the first half of the European session, albeit lacked any follow-through buying.

The pair built on its recent bounce from the 1.2425-20 support zone and edged higher for the third consecutive session on Tuesday, though a combination of factors capped any meaningful gains. The US dollar remained depressed amid dovish Fed expectations and was further pressured by Monday's disappointing US ISM Manufacturing PMI.

Investors now seem convinced that the Fed will wait for a longer period before slowing its massive monetary support. Apart from this, the risk-on impulse in the markets was seen as another factor that undermined the safe-haven greenback. That said, a solid rebound in the US Treasury bond yields helped limit any deeper losses for the buck.

Meanwhile, a modest uptick in crude oil prices underpinned the commodity-linked loonie and further acted as a headwind for the USD/CAD pair. Expectations for a continuous decline in US oil inventories assisted the black gold to recover a part of the previous day's heavy losses triggered by concerns over the fast-spreading Delta variant of the coronavirus.

There isn't any major market-moving economic data due for release on Tuesday, either from the US or Canada. Hence, the broader market risk sentiment and the US bond yields will influence the USD. Apart from this, traders might further take cues from oil price dynamics for some short-term opportunities around the USD/CAD pair.

Technical levels to watch

USD/CAD

Overview
Today last price 1.2512
Today Daily Change 0.0004
Today Daily Change % 0.03
Today daily open 1.2508
 
Trends
Daily SMA20 1.2541
Daily SMA50 1.2347
Daily SMA100 1.2369
Daily SMA200 1.2595
 
Levels
Previous Daily High 1.2515
Previous Daily Low 1.2453
Previous Weekly High 1.2605
Previous Weekly Low 1.2422
Previous Monthly High 1.2808
Previous Monthly Low 1.2303
Daily Fibonacci 38.2% 1.2491
Daily Fibonacci 61.8% 1.2477
Daily Pivot Point S1 1.2469
Daily Pivot Point S2 1.243
Daily Pivot Point S3 1.2408
Daily Pivot Point R1 1.2531
Daily Pivot Point R2 1.2554
Daily Pivot Point R3 1.2593

 

 

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