• A modest USD rebound helps to bounce off the 1.30 neighborhood.
• Weaker oil prices undermine Loonie and remain supportive.
• A sustained move beyond mid-1.3000s needed for additional gains.
The USD/CAD pair managed to rebound around 25-30 pips from Asian session lows, albeit seemed struggling to gain any strong follow-through.
The pair stalled Friday’s retracement slide from one-week tops and found some decent support near the key 1.3000 psychological mark. With investors looking past the Fed Chair Jerome Powell’s perceived dovish comments at the closely watched Jackson Hole symposium, a modest US Dollar rebound was seen as one of the key factors lending some support to the major.
Adding to this, a negative tone around oil markets, with WTI crude oil holding weaker around mid-$68.00s, further weighed on the commodity-linked currency – Loonie and remained supportive of the pair’s steady climb from daily lows.
The uptick, however, lacked any strong follow-through buying interest and remained capped below an important pivotal point, around mid-1.3000s, amid absent fundamental catalyst, in terms of any major market moving economic releases.
Technical levels to watch
Momentum back above the mentioned immediate hurdle could get extended towards the 1.3075-80 supply zone but any subsequent up-move might continue to confront stiff resistance near the 1.3100 handle.
On the flip side, the 1.3000 round figure mark remains a key support to defend, which if broken is likely to accelerate the slide back towards an important horizontal support near the 1.2965-60 region.