• Weaker oil prices weigh on commodity-linked Loonie.
• USD consolidates recent gains and remains supportive.
• Sliding US bond yields now seemed to cap gains.
The USD/CAD pair finally broke out of its Asian/early European session consolidation phase and refreshed session tops in the last hour.
The pair's latest leg of up-move over the past hour or so, to the highest level since December 20, lacked any fundamental trigger and was led by some renewed weakness in crude oil prices. In fact, WTI crude oil extended overnight slide and is currently placed at near two-week lows, which was eventually seen weighing on the commodity-linked currency - Loonie and driving the pair higher.
Further gains, however, remained capped amid subdued US Dollar price-action, primarily on the back of weaker US Treasury bond yields. Despite firming expectations that the Fed could opt for a faster monetary policy tightening cycle, sliding US bond yields failed to assist the greenback to build on its recent upsurge and was eventually seen keeping a lid on the pair's bullish momentum.
Focus now shifts to important US macroeconomic releases, with the key focus on ISM manufacturing PMI, which along with the Fed Chair Jerome Powell's second appearance before the Congress would be looked upon for some fresh bullish impetus.
Technical levels to watch
A follow-through buying interest could the pair towards the 1.2900 handle, above which the bullish momentum is likely to get extended beyond 1.2915-20 supply zone towards reclaiming the key 1.30 psychological mark.
On the flip side, any meaningful retracement below the 1.2830-25 region is likely to find support near the 1.2800 handle, which if broken might prompt some additional long-unwinding trade and drag the pair further towards the 1.2755 support level.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD holds steady below 1.0600 ahead of PMIs, Powell
EUR/USD is consolidating in a narrow range below 1.0600 in early Europe on Monday. The pair keeps its calm amid a steady US Dollar, higher US Treasury bond yields and a cautious mood. US ISM PMI and Powell's speech in focus.
GBP/USD struggles around 1.2200, awaits central banks' speakers
GBP/USD is trading around 1.2200, struggling to gain any meaningful traction in the European trading on Monday. The risk-on impulse is seen undermining the safe-haven USD and lending support to the major. US PMI, BoE and Fed speeches awaited.
Gold: Will Fed Chair Jerome Powell rescue XAU/USD buyers?
Gold price is trading below $1,840, at its lowest level since March 10, setting off the final quarter of this year on a negative note. The USD is consolidating the previous rebound above the 106.00 level against its major peers, underpinned by a fresh upswing in the US Dollar.
Floki Inu Price Forecast: FLOKI sets stage for 30% rally
Floki Inu (FLOKI) price has triggered a quick but explosive uptrend in the last 24 hours. The uptrend has pushed the meme coin above a key hurdle and could assist FLOKI bulls in reversing the downtrend.
The week ahead - US Nonfarm Payrolls, Tesco and Wetherspoon results
We’ll get the latest US payrolls report for August this week. Having seen the Federal Reserve leave rates unchanged as expected at their recent September meeting the jury remains out as to whether we will see another rate hike at the next meeting in November.