“¢ The ongoing USD profit-taking prompts some additional selling on Tuesday.
“¢ Bullish oil prices underpin Loonie and further collaborate to the downfall.
The USD/CAD pair remained under some selling pressure for the second consecutive session and extended overnight slide from the 1.2900 neighborhood.
The pair on Monday retreated over 100-pips from an intraday high level of 1.2890, with a combination of negative factors continuing to exert downward pressure through the early European session on Tuesday.
After an initial uptick, the US Dollar extended its retracement slide from YTD tops and did little to lend any support. This coupled with the ongoing upsurge in crude oil prices underpinned the commodity-linked currency – Loonie and further collaborated to the pair’s offered tone.
The pair has now dropped to its immediate support near mid-1.2700s, over one-week lows, which if broken should pave the way for further near-term depreciating slide ahead of this week’s important releases of the latest FOMC meeting minutes and the US durable goods orders.
Technical levels to watch
Sustained weakness below the above-mentioned support, leading to a subsequent drop below 1.2730 level, is likely to accelerate the fall towards 100-day SMA support near the 1.2700-1.2695 region. On the flip side, any recovery attempt is likely to confront immediate resistance near 1.2785 level, with is followed by the 1.2800 handle and 50-day SMA barrier near the 1.2820-25 region.
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