USD/CAD climbs above 1.3150 on crude oil sell-off

• US Dollar Index struggles to surpass the 96.50 area.
• Trump warns about oil prices getting too high.
• WTI drops below $56 on Monday.

After edging lower toward the 1.31 mark earlier in the day, the USD/CAD pair gained traction in the last couple of hours and advanced to a session high 1.3160. As of writing, the pair was trading at 1.3155, adding 0.15% on a daily basis.

The barrel of West Texas Intermediate, which closed the previous week a little above $57, came under heavy selling pressure today after U.S. President Donald Trump warned about oil prices getting too high. “Oil prices getting too high. OPEC, please relax and take it easy. World cannot take a price hike – fragile!” Trump said via Twitter. Following these remarks, the barrel of WTI lost more than 2% and was last seen trading at $55.90.

On the other hand, the greenback struggles to make a meaningful recovery on Monday and doesn’t allow the pair to continue to push higher. At the moment, the US Dollar Index is down 0.05% on a daily basis at 96.43. The data published by the Federal Reserve Bank of Chicago today showed that the business activity in January lost momentum with the National Activity Index dropping to -0.43 from 0.05 in December. Later in the session, wholesale inventories and the Dallas Fed Manufacturing Index will be looked upon for fresh impetus.

Technical levels to consider

The pair could face the initial resistance at 1.3200 (psychological level), 1.3240 (Feb. 22 high) and 1.3275 (50-DMA). On the downside, supports could be seen at 1.3110 (daily low), 1.3065 (Feb. 1 low) and 1.3000 (psychological level).