USD/CAD erases daily gains as WTI rebounds to $59 region

• WTI turns positive on the day despite risk-aversion.
• US Dollar Index continues to move sideways near mid-96s.
• 10-year US T-bond yield drops below 2.4%.

After climbing to its highest level since early March at 1.3447, the USD/CAD pair lost its traction in the NA session and erased its gains. As of writing, the pair was trading at 1.3420, losing 0.07% on a daily basis.

Earlier today, crude oil extended its slide with the barrel of West Texas Intermediate slumping to a weekly low of $58.15 and weighed on the commodity-sensitive loonie to help the pair push higher. However, the WTI recovered to $59 area and turned positive on the daily chart to help the CAD show resilience against its major rivals.

On the other hand, the US Dollar Index is struggling to find direction on Monday and moves sideways near the 96.50 region. Following a modest recovery during the first half of the day, the 10-year US T-bond yield lost nearly 3% in the NA session and touched its lowest level since December 2017 to remind investors of a possible recession in the U.S. amid the yield curve inversion. Nevertheless, the greenback didn’t show a significant reaction to this development to allow the DXY to stay in its range.

According to today’s data from the U.S., which were largely ignored by the market participants,  the Chicago Fed’s National Activity Index dropped to -0.29 and the Dallas Fed Manufacturing Index came in at 8.3 in March to beat the market expectation of 7.

Technical levels to consider