- USD/CAD is trading in the positive territory on Friday.
- US Dollar Index stays above 90.50 ahead of consumer confidence data.
- WTI erases earlier losses, stays quiet around $58.
The USD/CAD pair edged higher during the first half of the day on Friday and touched a session top of 1.2755 before losing its bullish momentum. As of writing, the pair was up 0.25% on a daily basis at 1.2732.
The ongoing correction in crude oil prices made it difficult for the commodity-related loonie to find demand on Friday. The barrel of West Texas Intermediate (WTI), which touched its highest level in more than a year at $58.88 on Wednesday lost nearly 1% on Thursday and extended its slide to a three-day low of $57.38 earlier in the day. As of writing, the WTI was virtually unchanged on the day at $57.90.
On the other hand, the rebound witnessed in the US Dollar Index (DXY) is reflecting a broad-based USD strength ahead of the weekend and allows USD/CAD to stay in the positive territory.
Ahead of the University of Michigan’s preliminary February Consumer Sentiment Index, the DXY is up 0.22% on the day at 90.61. Additionally, New York Federal Reserve President John Williams will be delivering a speech at 1500 GMT.
USD/CAD technical outlook
Assessing USD/CAD’s near-term technical outlook, “USD/CAD has not managed to see a close beneath the crucial 1.2686/82 level, reverting back higher and completing a small bullish ‘hammer’ to suggest further near-term upside,” noted Credit Suisse analysts.
“We see room for a move back to key short-term averages at 1.2741/46, with scope for an overshoot to the 55-day average at 1.2770, which then ideally caps for a move back lower,” analysts added. “Post this setback higher, we look for weakness to resume and look for an eventual close beneath the crucial 1.2686/82 lows.”
Additional levels to watch for
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