- The USD fails to benefit from positive trade-related headlines.
- Bulls even shrugged off a mildly weaker tone around Oil prices.
- The focus remains on US CPI figures and US-China trade talks.
The USD/CAD pair extended its intraday pullback from one-week tops and is currently placed at the lower end of its daily trading range, around the 1.3300 handle.
The pair continued with its struggle to capitalize on the move beyond the very important 200-day SMA and once again started retreating from the 1.3345-50 supply zone amid the prevalent selling bias surrounding the US Dollar.
Weighed down by renewed USD weakness
As investors looked past Wednesday’s FOMC meeting minutes, which did little to dampen prospects for another rate cut by the Fed in October, nervousness ahead of the crucial US-China trade talks prompted some Greenback selling.
In the latest trade-related news, South China Morning Post (SCMP) reported this Thursday that trade discussions between the two countries had made “no progress” and the principal Chinese negotiators might cut short their stay.
Meanwhile, other reports said that top Chinese envoy Liu He would stay in Washington through Friday. This was followed by news that the US is considering entering into a currency agreement with China as a part of a partial trade deal.
The positive trade-related headlines did little to attract any meaningful USD buying interest amid receding hopes of a major breakthrough from the crucial high-level US-China trade talks, starting later this Thursday.
Bulls even shrugged off a mildly weaker tone surrounding Crude Oil prices, which tend to weigh on the commodity-linked currency – Loonie. Oil prices inched down on the back of the overnight report, showing a larger-than-expected rise in the US inventories last week.
Despite the pullback, the pair remains well within a broader trading range held over the past one-week or so. Hence, traders are likely to wait for a decisive breakthrough the mentioned range before placing any aggressive directional bets.
Apart from the incoming trade-related headlines, investors on Thursday will further take cues from the release of US consumer inflation figures, due for release later during the early North-American session, in order to grab some short-term trading opportunities.
Technical levels to watch