USD/CAD sits near 2-month tops, eyeing a move beyond 1.3300 mark
- USD/CAD regains positive traction following the previous session’s brief pause.
- Sustained USD buying remained supportive; bulls shrug off positive oil prices.
- The set-up confirms bullish bias and supports prospects for additional gains.
The USD/CAD pair regained some positive traction on Wednesday, with bulls making a fresh attempt to build on the momentum beyond the 1.3300 round-figure mark.
Following the previous session's brief pause, the pair caught some fresh bids on Wednesday and built on its recent strong positive momentum witnessed over the past one month or so.
Stronger USD remained supportive
Sustained US dollar buying interest, underpinned by upbeat US ISM Manufacturing PMI published earlier this week, was seen as one of the key factors driving the pair higher.
This coupled with worries over coronavirus, despite China's efforts to contain the outbreak, further benefitted the greenback's perceived safe-haven status against its Canadian counterpart.
Meanwhile, the uptick seemed rather unaffected by a mildly positive tone surrounding crude oil prices, which tend to underpin demand for the commodity-linked currency – the loonie.
Given last week's sustained move beyond the very important 200-day SMA, Wednesday's positive move reaffirms a near-term bullish breakout and sets the stage for additional gains.
Hence, some follow-through strength, towards challenging the 1.3335-40 supply zone, now looks a distinct possibility as traders now look forward to the US macro data fro a fresh impetus.
Wednesday's US economic docket highlights the release of the ADP report and ISM Non-Manufacturing PMI, which might influence the USD price dynamics and produce some trading opportunities.
Technical levels to watch
Author
Haresh Menghani
FXStreet
Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.
