- The USD regains traction despite weaker US bond yields, trade uncertainty.
- Bullish Oil prices do little to support the Loonie or hinder the positive move.
Buying interest around the Greenback picked up some pace during the early European session on Tuesday and lifted the USD/CAD pair to one-month tops, around the 1.3250-55 region in the last hour.
Following a modest pullback on the first day of a new trading week, the US Dollar managed to regain traction and remained well within the striking distance of multi-week tops. The USD bulls seemed rather unaffected by a mildly weaker tone surrounding the US Treasury bond yields and renewed US-China trade uncertainty.
Resurgent USD demand remained supportive
The recent trade optimism faded rather quickly after the US President Donald Trump’s comments over the weekend, saying that trade talks were going “very nicely,” but there was no agreement yet on rollback of existing tariffs. However, the mixed market mood was seen benefitting the Greenback’s safe-haven status against its Canadian counterpart.
Meanwhile, the prevalent bullish trading sentiment around Crude Oil prices, which tend to underpin the commodity-linked currency – Loonie, also did little hinder the pair’s ongoing positive momentum for the third consecutive session, to the highest level since October 11.
It will now be interesting to see if the pair is able to capitalize on the positive momentum or meets with some fresh supply at higher levels as investors look forward to Trump’s appearance at the New York Economic Club later during the US trading session on Tuesday.
In the meantime, a scheduled speech by the Fed Governor Richard Clarida might influence the USD price dynamics and further collaborate towards producing some meaningful trading opportunities.
Technical levels to watch
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