USD/CAD gains some positive traction, climbs beyond 1.3400 mark after mixed US housing data

   “¢   A goodish bounce in the US bond yields underpins USD and helped limit the downside.
   “¢   Rallying oil prices boost Loonie and seemed to cap any attempted intraday positive move.

The USD/CAD pair quickly reversed a mid-European session dip and is currently placed at the top end of its daily trading range, just above the 1.3400 round figure mark.

A strong rally in crude oil prices underpinned demand for the commodity-linked currency – Loonie and turned out to be one of the key factors behind the pair’s downtick to an intraday low level of 1.3380. However, a goodish rebound in the US Treasury bond yields extended some support to the US Dollar and helped limit any deeper losses.  

On the US economic data front, the disappointing release of housing starts, falling to 1.16 million for March as compared to an upwardly revised 1.27 million in the previous month, was largely offset by mostly in-line building permits, coming in at 1.30 million vs. 1.32 million previous, and failed to provide any meaningful impetus.  

Today’s US economic docket also features the release of the Conference Board’s Consumer Confidence Index, which will be looked upon for some short-term trading impetus, albeit fresh concerns over slower US economic growth could keep a lid on any runaway rally for the major, at least for the time being.

Hence, it would be prudent to wait for a strong follow-through buying beyond the overnight swing highs, around the 1.3440-45 region, or two-week tops, before traders eventually position for any further near-term appreciating move towards reclaiming the key 1.3500 psychological mark.

Technical levels to watch