- The USD remains well supported by a follow-through upsurge in the US bond yields.
- Weaker Crude Oil prices undermined Loonie and remained supportive of the up-move.
- Investors now look forward to Canadian monthly GDP/US data for a fresh impetus.
The USD/CAD pair held on to its positive tone above the 1.3300 handle through the early European session on Friday, albeit remained well within a three-day-old trading range.
After the previous session’s modest pullback, a combination of supporting factors helped the pair regained some bullish traction on the last trading day of the week and climb back closer to weekly tops. The US Dollar remained well supported by the latest trade optimism and Thursday’s mostly in line US GDP print.
It is worth mentioning that China’s Foreign Ministry spokesman Gao Feng on Thursday said that China is willing to negotiate with the US on trade issues with a calm attitude and added that Beijing will not retaliate against the latest US tariffs, for now, triggering a fresh wave of the global risk-on trade.
Weaker Oil prices remain supportive
Improving global risk sentiment allowed the US Treasury bond yields to continue scaling higher on Friday, which provided an additional boost to the greenback. This coupled with weaker Crude Oil prices undermined demand for the commodity-linked currency – Loonie and remained supportive of the up-move.
Oil prices failed to capitalize on this week’s strong up-move – triggered by a bigger-than-expected fall in the US inventories reported earlier in the week and an unexpected turn for the better in the US-China trade war – and was last seen trading down by around 1% for the day, just above the $56.00/barrel mark.
It, however, remains to be seen if bulls are able to capitalize on the move or the pair continues with its struggle to make it through the 1.3345 heavy supply zone as the market focus now shifts to Friday’s key release of the monthly Canadian GDP growth figures for the month of June.
The US economic docket highlights the release of personal spending data and July core PCE Price index, which might further contribute towards producing some meaningful short-term trading opportunities later during the early North-American session.
Technical levels to watch
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