- USD/CAD failed to capitalize on the overnight momentum to two-week tops.
- A subdued USD price action failed to impress bulls or provide any impetus.
- Softer oil prices undermined the loonie and helped limit any deeper losses.
The USD/CAD pair seesawed between tepid gains/minor losses on Tuesday and was last seen trading with modest losses, below the 1.3300 mark.
A combination of diverging factors – a subdued US dollar demand and oil price dynamics – failed to provide any impetus or assist the pair to build on the previous session's goodish positive move to two-week tops.
Traders preferred to stay on the sidelines
The USD bulls remained on the defensive for the third consecutive session on the back of renewed speculations that the Fed could cut interest rates to offset any negative impact from the coronavirus pandemic.
This coupled with an intraday turnaround in the US Treasury bond yields, dragging yields on the benchmark 10-year bond to multi-year lows, further weighed on the USD and capped any meaningful upside.
The negative factor, to a larger extent, was offset by a mildly weaker tone surrounding oil prices, which did little to lend any support to the commodity-linked currency – the loonie and helped limit the downside.
Looking at the technical picture, the pair has been struggling to find acceptance above the 1.3300 round-figure mark. This makes it prudent to wait for some strong follow-through buying before placing fresh bullish bets.
Moving ahead, market participants now look forward to the US economic docket, highlighting the release of the Conference Board's Consumer Confidence Index, in order to grab some short-term trading opportunities.
Technical levels to watch
|Today last price||1.3218|
|Today Daily Change||-0.0072|
|Today Daily Change %||-0.54|
|Today daily open||1.329|
|Previous Daily High||1.3308|
|Previous Daily Low||1.3225|
|Previous Weekly High||1.328|
|Previous Weekly Low||1.3202|
|Previous Monthly High||1.3255|
|Previous Monthly Low||1.29|
|Daily Fibonacci 38.2%||1.3276|
|Daily Fibonacci 61.8%||1.3257|
|Daily Pivot Point S1||1.3241|
|Daily Pivot Point S2||1.3192|
|Daily Pivot Point S3||1.3158|
|Daily Pivot Point R1||1.3324|
|Daily Pivot Point R2||1.3357|
|Daily Pivot Point R3||1.3406|
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