USD/CAD refreshes daily low amid weaker USD, retreating oil prices to limit losses

USD/CAD witnessed an intraday pullback from the one-week high touched earlier this Thursday.
A turnaround in the risk sentiment weighed on the safe-haven USD and prompted fresh selling.
Retreating crude oil prices could undermine the loonie and help limit the downside for the pair.

Haresh Menghani FXStreet

The USD/CAD pair extended its retracement slide from the one-week high and dropped to a fresh daily low, around the 1.2725-1.2720 area during the early North American session.

The pair continued with its struggle to make it through the 1.2770-1.2780 supply zone and witnessed some intraday selling amid modest US dollar weakness. A Kremlin spokesperson said that Russia is still open to diplomacy and has an interest in that, which helped ease market concerns over the worsening situation in Ukraine. This, in turn, led to a solid recovery in the equity markets and drove flows away from traditional safe-haven assets, including the greenback.

That said, a combination of factors could limit any meaningful slide for the USD. Despite the latest development, fears about a further escalation in tensions between Russia and the West over Ukraine should keep a lid on any optimistic move in the markets. Apart from this, a sharp rally in the US Treasury bond yields should act as a tailwind for the buck and the USD/CAD pair amid retreating crude oil prices, which tend to undermine the commodity-linked loonie.

Nevertheless, the USD/CAD pair, for now, seems to have snapped three successive days of the losing streak and remains at the mercy of the situation in Ukraine. In the meantime, traders on Tuesday might take cues from the release of the flash US PMI prints. Apart from this, the US bond yields would influence the USD demand. This, along with oil price dynamics should provide some impetus to the USD/CAD pair and allow traders to grab some short-term opportunities.

Technical levels to watch

USD/CAD

Overview
Today last price	1.2733
Today Daily Change	-0.0020
Today Daily Change %	-0.16
Today daily open	1.2753

Trends
Daily SMA20	1.271
Daily SMA50	1.2708
Daily SMA100	1.2627
Daily SMA200	1.2546

Levels
Previous Daily High	1.2762
Previous Daily Low	1.2722
Previous Weekly High	1.2784
Previous Weekly Low	1.2664
Previous Monthly High	1.2814
Previous Monthly Low	1.2451
Daily Fibonacci 38.2%	1.2747
Daily Fibonacci 61.8%	1.2737
Daily Pivot Point S1	1.2729
Daily Pivot Point S2	1.2706
Daily Pivot Point S3	1.2689
Daily Pivot Point R1	1.2769
Daily Pivot Point R2	1.2786
Daily Pivot Point R3	1.281

Author

Haresh Menghani

FXStreet

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

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