USD/CAD sticks to modest intraday gains, lacks follow-through amid bullish Oil prices


  • USD/CAD regains some positive traction on Friday amid a modest pickup in the USD demand.
  • Thursday’s upbeat US macro data fuels hawkish Fed expectations and benefits the Greenback.
  • Bullish Crude Oil prices continue to underpin the Loonie and keep a lid on any further gains.
  • Traders now eye the US PCE report for a fresh impetus ahead of the FOMC meeting next week.

The USD/CAD pair attracts some buyers on Friday and reverses a part of the previous day's slide to the 1.3300 mark, or its lowest level since November 17. The pair sticks to its intraday gains through the early European session and is currently placed near the daily top, just below mid-1.3300s.

The US Dollar draws support from the mostly upbeat US macro data released on Thursday and edges higher on the last day of the week, which, in turn, is acting as a tailwind for the USD/CAD pair. In fact, the US Commerce Department reported that the economy expanded at a 2.9% annualised pace during the fourth quarter against consensus estimates for a reading of 2.6%. The stronger-than-expected growth figures could allow the Fed to maintain its hawkish stance for longer. This pushes the US Treasury bond yields higher and continues to benefit the Greenback.

The markets, however, still seem convinced that the Fed will slow the pace of its policy-tightening and deliver a smaller 25 bps rate hike in February. This holds back the USD bulls from placing aggressive bets. Apart from this, the underlying bullish sentiment surrounding Crude Oil prices is underpinning the commodity-linked Loonie. The aforementioned factors should contribute to capping any meaningful upside for the USD/CAD pair. Traders might also prefer to wait for the release of the US Core PCE Price Index, due later during the early North American session.

The key focus, however, will remain glued to the outcome of the highly-anticipated two-day FOMC policy meeting, scheduled to be announced next week. In the meantime, the US bond yields and the broader risk sentiment will drive the USD demand. Apart from this, Oil price dynamics should provide some impetus to the USD/CAD pair and assist traders to grab short-term opportunities.

Technical levels to watch

USD/CAD

Overview
Today last price 1.3335
Today Daily Change 0.0011
Today Daily Change % 0.08
Today daily open 1.3324
 
Trends
Daily SMA20 1.3445
Daily SMA50 1.3504
Daily SMA100 1.3522
Daily SMA200 1.3205
 
Levels
Previous Daily High 1.3408
Previous Daily Low 1.3303
Previous Weekly High 1.3521
Previous Weekly Low 1.3351
Previous Monthly High 1.3705
Previous Monthly Low 1.3385
Daily Fibonacci 38.2% 1.3343
Daily Fibonacci 61.8% 1.3368
Daily Pivot Point S1 1.3282
Daily Pivot Point S2 1.324
Daily Pivot Point S3 1.3178
Daily Pivot Point R1 1.3387
Daily Pivot Point R2 1.345
Daily Pivot Point R3 1.3492

 

 

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