USD/CAD rebounds to mid-1.2900s as WTI turns red near $44

USD/CAD reversed its direction after renewing two-year lows.
WTI pared early gains and turned red below $44.50 ahead of EIA data.
US Dollar Index posts small gains following Tuesday's sharp decline.

Eren Sengezer FXStreet

The USD/CAD pair lost 70 pips on Tuesday and extended its slide during the Asian trading hours on Wednesday to touch its lowest level in two years at 1.2914. Ahead of the American session, the pair started to erase its losses and was last seen gaining 0.12% on the day at 1.2947.

CAD weakens as WTI remains on the back foot

The heavy selling pressure surrounding the USD caused USD/CAD to remain bearish since the beginning of the week. The risk-positive market environment weighed on the US Dollar Index (DXY) and dragged it to a fresh 31-month low of 91.10. However, the poor performance of major European equity indexes and the 0.25% decline witnessed in the S&P 500 Futures seem to be helping the greenback stay resilient against its peers. At the moment, the DXY is up 0.13% at 91.43.

Meanwhile, the commodity-sensitive loonie is struggling to find demand amid falling crude oil prices. The barrel of West Texas Intermediate (WTI) is down 0.4% on the day at $44.20 as investors await clarity on the output strategy of OPEC+ in 2021.

Later in the day, the ADP will release the November Employment Change data for the US alongside the ISM NY's Business Conditions Index. The Canadian economic docket will feature the third-quarter Labor Productivity report.

Technical levels to watch for

USD/CAD

Overview
Today last price	1.2949
Today Daily Change	0.0012
Today Daily Change %	0.09
Today daily open	1.2937

Trends
Daily SMA20	1.3053
Daily SMA50	1.3166
Daily SMA100	1.3216
Daily SMA200	1.3525

Levels
Previous Daily High	1.301
Previous Daily Low	1.2928
Previous Weekly High	1.3112
Previous Weekly Low	1.2972
Previous Monthly High	1.337
Previous Monthly Low	1.2923
Daily Fibonacci 38.2%	1.296
Daily Fibonacci 61.8%	1.2979
Daily Pivot Point S1	1.2906
Daily Pivot Point S2	1.2876
Daily Pivot Point S3	1.2824
Daily Pivot Point R1	1.2989
Daily Pivot Point R2	1.3041
Daily Pivot Point R3	1.3071

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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