“¢ A subdued USD demand fails to assist the pair to build on momentum beyond 100-DMA.
“¢ Traders opt to take some profits off the table ahead of important Canadian macro data.
The USD/CAD pair met with some fresh supply on Friday and eroded a part of the previous session’s strong up-move to over one-month tops.
The pair continued with its struggled to build on the momentum beyond 100-day SMA, with a combination of factors prompting some long-unwinding trade ahead of the 1.3100 handle.
With investors looking past Wednesday’s hawkish FOMC meeting minutes, a modest uptick in the US Treasury bond yields failed to provide any additional boost to the US Dollar.
Adding to this, a mildly positive tone around crude oil prices underpinned the commodity-linked currently Loonie and further collaborated towards exerting some downward pressure.
Traders also seemed inclined to take some profits off the table, especially after the latest leg of an upsurge of over 150-pips since the beginning of this week and ahead of important Canadian macro data.
Today’s economic docket highlights the release of consumer inflation figures and monthly retail sales data from Canada, which might play a key role in influencing the pair’s momentum ahead of next week’s BoC decision.
Technical levels to watch
A follow-through selling is likely to accelerate the fall towards the 1.3025 intermediate support en-route the key 1.30 psychological mark. On the flip side, the 1.3090-1.3100 region might continue to act as an immediate resistance, above which the pair aim towards testing the 1.3160 supply zone.
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