- USD/CAD continues to push higher after breaking above 1.2300.
- US Dollar Index clings to daily gains above 91.00.
- WTI trades above $65 ahead of weekly API data.
The USD/CAD pair registered small daily losses on Monday but managed to reverse its direction ahead of mid-tier data releases on Tuesday. As of writing, the pair was trading at a five-day high of 1.2338, gaining 0.5% on a daily basis.
USD capitalizes on safe-haven flows
The broad-based selling pressure surrounding the greenback and rising crude oil prices weighed on USD/CAD at the start of the week. With the market mood souring, the USD started to gather strength and triggered a rebound in the pair. Reflecting the risk-averse market environment, the S&P 500 Futures are down 0.5% on the day and the US Dollar Index is rising 0.35% at 91.30.
Later in the session, International Merchandise Trade data from Canada will be looked upon for fresh impetus. The US economic docket will feature Goods Trade Balance, ISM-NY Business Conditions Index, IBD/TIPP Economic Optimism Index and Factory Orders data.
Nevertheless, investors are likely to remain focused on the performance of Wall Street’s main indexes. A sharp decline in US stocks in the second half of the day could allow the USD to continue to outperform its rivals.
On the other hand, the barrel of West Texas Intermediate (WTI) is rising more than 1% above $65 ahead of the American Petroleum Institute’s Weekly Crude Oil Stock report and helping the CAD limit its losses for the time being.
Technical levels to watch for
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