“¢ Remains below 50-DMA despite surging US bond yields/reviving USD demand.
“¢ Traders now eye US monthly retail sales data for some fresh impetus.
The USD/CAD traded with a mild negative bias on Tuesday and momentarily dipped back below the 1.2800 handle in the last hour, albeit quickly recovered few pips thereafter.
The pair struggled to build on overnight rebound of over 60-pips from an intraday low level of 1.2750, led by a Bloomberg report saying that NAFTA negotiators are poised to miss the deadline this week, and failed ahead of 50-day SMA.
However, the ongoing upsurge in the US Treasury bond yields, which has been one of the key factors behind reviving US Dollar demand since the second half of Monday’s US trading session, helped limit any deeper retracement.
Meanwhile, a range-bound price action around crude oil prices did little to influence the commodity-linked currency – Loonie, with the USD price dynamics acting as an exclusive driver of the pair’s momentum through the early European session.
Today’s key focus would be on the release of US retail sales data, which along with the release of Empire State manufacturing index should provide some meaningful impetus later during the early NA session.
Technical levels to watch
Immediate resistance is pegged near the 1.2830 region (50-DMA), above which the pair is likely to aim towards reclaiming the 1.2900 round figure mark. On the flip side, any meaningful retracement is likely to find support near the 1.2770-65 region, which if broken might now drag the pair further towards testing 100-day SMA support near the 1.2690-85 region.
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