USD/CAD sinks to lows near 1.3130 amid renewed USD weakness
The USD/CAD pair stalled recovery move from Thursday's nearly three-month and has now retreated around 30-pips from session peak.
Currently hovering around 1.3130 region, testing session lows, a fresh bout of US Dollar selling pressure failed to assist the pair to extend overnight recovery movement of over 100-pips from the lowest level since Oct. 19.
However, weaker sentiment around oil market, with WTI crude oil losing over 1% and sinking to session lows near $52.40, is weighing on the commodity-linked currency - Loonie, and seems to restrict further downslide.
Next on tap would be US macro data that includes - monthly retail sales, PPI print and Prelim UoM Consumer Sentiment index, which might provide some short-term trading opportunities. In the meantime, oil price dynamics would also influence the major and hence, focus would also be the weekly report on US rig counts by Baker Hughes.
Technical levels to watch
A follow through selling pressure below session low support near 1.3130 level is likely to accelerate the slide back towards 1.3100 round figure mark, also coinciding with the very important 200-day SMA. A convincing break back below 200-day SMA would turn the pair vulnerable to head back towards 3-month lows support near 1.3030 region, with some intermediate support near 1.3050-55 area.
On the upside, 1.3170-75 area now seems to have emerged as immediate hurdle, which if cleared is likely to accelerate the recovery move towards 1.3210-15 resistance, en-route 1.3240-50 strong resistance.
Author
Haresh Menghani
FXStreet
Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.
