“¢ Surging oil prices underpin Loonie and prompted fresh selling at higher levels.
“¢ Dismal US retail sales data exert some pressure on the already weaker USD.
“¢ Canadian manufacturing PMI falls to 30-month low and helped limit downside.
The USD/CAD pair faded an early North-American bullish spike and quickly retreated around 30-35 pips from an intraday high level of 1.3371.
After Friday’s sharp pull-back, triggered by surprisingly stronger Canadian GDP growth figures, the pair did attempt a modest recovery on the first trading day of a new week but failed to capitalize on the uptick.
The ongoing bullish run-up in crude oil prices, advancing to the highest level since early November, continued underpinning demand for the commodity-linked – Loonie and prompted some fresh selling at higher levels.
This coupled with some renewed selling bias surrounding the US Dollar, which lost some additional ground following the release of weaker US monthly retail sales data, exerted some additional pressure in the last hour.
Meanwhile, the USD downtick turned out to be rather limited in wake of an upward revision of the previous month’s retail sales figures and turned out to be one of the key factors lending some support to the major.
Adding to this, the disappointing release of Markit Canada manufacturing PMI, coming at 50.5 for March – the lowest level since Sept. 2016, further collaborated towards limiting the downside, at least for the time being.
Moving ahead, today’s US economic docket also features the release of ISM manufacturing PMI, which followed by the BoC Governor Poloz’s speech might further contribute towards producing meaningful trading opportunities.
From a technical perspective, the pair has been finding some support near the 1.3335 horizontal level, which if broken should pave the way for an extension of the recent rejection slide from the 1.3445-50 supply zone.
Technical levels to watch
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