“¢ Today’s uptick seemed unaffected by some renewed USD selling bias.
“¢ A strong bullish surge in oil prices underpinned Loonie and capped gains.
The USD/CAD pair held on to its positive tone through the early North-American session, albeit has retreated around 15-20 points from session high level of 1.2949.
After an initial tick lower to 1.2912, the pair regained positive traction and built on Friday’s modest rebound from 3-1/2 month lows. The uptick lacked any fresh fundamental trigger and defied some renewed US Dollar selling bias.
Even the ongoing strong bullish surge in crude oil prices, which tends to underpin demand for the commodity-linked Loonie, also did little to prompt any fresh selling around the major, albeit collaborated towards capping any meaningful up-move.
The up-move, however, stalled near mid-1.2900s, with today’s better-than-expected Canadian Wholesale Sales figures, coming in to show a growth of 1.5% for July as against 0.4% expected and -0.8% previous, prompting some weakness in the last hour or so.
Despite the pull-back, the pair has managed to hold comfortably above the 1.2900 handle as market participants now seemed to hold back from placing any aggressive bets and prefer to wait for fresh updates on the North American Free Trade Agreement (NAFTA).
Technical levels to watch
The 1.2900 handle is likely to protect the immediate downside and is followed by the very important 200-day SMA support near the 1.2870-65 region. On the upside, immediate resistance is pegged near the 1.2970 level, above which the pair seems all set to surpass the key 1.30 psychological mark and test 1.3025-30 supply zone.
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