USD/CAD rebounds above 1.3900 as WTI pulls away from nine-day highs

WTI retreats toward $17, clings to strong daily gains.
US Dollar Index looks to close near 99.
Canadian economy is expected to contract by 2.6% in Q1.

Eren Sengezer FXStreet

The USD/CAD pair dropped to its lowest level since mid-March at 1.3849 on Thursday but staged a decisive rebound during the American trading hours. As of writing, the pair was up 0.38% on the day at 1.3930 and was looking to snap its three-day losing streak.

Earlier in the day, the ongoing recovery in crude oil prices helped the CAD continue to gather strength against the greenback. The barrel of West Texas Intermediate (WTI) rose to a nine-day high of $18.57 before going into a consolidation phase. At the moment, the WTI is trading near $17, gaining 12% on the day.

USD ends April on a weak note

Meanwhile, the data published by Statistics Canada revealed that the Canadian economic activity was virtually unchanged on a monthly basis in February. Moreover, the flash estimate showed that the GDP is expected to decline by 2.6% in the first quarter.

Commenting on the market reaction, “unsurprisingly, the CAD ignored the data. With month-end dynamics the primary focus this week, a stale GDP report was never going to be that interesting to follow anyway,” TD Securities analysts said. On the same note, the pair's rebound picked up steam despite the broad USD weakness to reflect the impact of month-end flows and profit-taking on the pair.

The US Dollar Index, which tracks the USD's performance against a basket of six major currencies, fell below the 99 handle for the first time in more than two weeks on Thursday. Although the index recovered modestly in the last hour and steadied around 99.10, it's headed to post losses for the fifth straight day.

Technical levels to watch for

USD/CAD

Overview
Today last price	1.3932
Today Daily Change	0.0051
Today Daily Change %	0.37
Today daily open	1.3881

Trends
Daily SMA20	1.4049
Daily SMA50	1.3904
Daily SMA100	1.3525
Daily SMA200	1.3378

Levels
Previous Daily High	1.4004
Previous Daily Low	1.3876
Previous Weekly High	1.4265
Previous Weekly Low	1.4
Previous Monthly High	1.4668
Previous Monthly Low	1.3315
Daily Fibonacci 38.2%	1.3925
Daily Fibonacci 61.8%	1.3955
Daily Pivot Point S1	1.3837
Daily Pivot Point S2	1.3792
Daily Pivot Point S3	1.3709
Daily Pivot Point R1	1.3965
Daily Pivot Point R2	1.4049
Daily Pivot Point R3	1.4093

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.

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