“¢ The USD fails to capitalize on the overnight post-FOMC rebound.
“¢ Weaker oil prices undermine Loonie and helped limit any downside.
“¢ Traders now eye second-tier US economic data for some impetus.
The USD/CAD pair lacked any firm directional bias and seesawed between tepid gains/minor losses through the mid-European session on Thursday.
A combination of diverging forces failed to assist the pair to build on the overnight post-FOMC goodish bounce from sub-1.3400 level, or over one-week lows, and led to a subdued/range-bound price action on Thursday.
With investors looking past not so dovish FOMC statement, the US Dollar struggled to attract any follow-through buying and remained on the defensive despite a modest uptick in the US Treasury bond yields.
The negative factor was largely negated by a weaker tone surrounding crude oil prices, now down over 1%, which undermined demand for the commodity-linked currency – Loonie and helped limit any meaningful slide.
Oil fell on Thursday, weighed down by record US crude production that led to a surge in inventories. In fact, US crude stockpiles last week rose to their highest level since September 2017 and stood at 470.6 million barrels.
Moving ahead, today’s second-tier US economic data – Challenger Job Cuts, initial weekly jobless claims, preliminary Nonfarm Productivity and Unit Labor Cost, will now be looked upon for some trading opportunities.
The key focus, however, will be on Friday’s closely watched US monthly jobs report – popularly known as NFP, which might influence the near-term USD price dynamics and eventually provide a fresh directional impetus.
Technical levels to watch
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