“¢ The USD finds some support amid a goodish bounce in the US bond yields.
“¢ Weaker Oil prices undermine Loonie and helped limit any further downside.
“¢ Traders now eye Powell’s scheduled speech for some meaningful impetus.
The USD/CAD pair now seems to have entered a bearish consolidation phase and was seen oscillating in a narrow trading band near two-week lows.
The pair seesawed between tepid gains/minor losses through the early European trading session on Tuesday, though a combination of supporting factors helped limit any further downside, at least for the time being. The US Dollar attracted some buying interest amid a goodish rebound in the US Treasury bond yields and was seen as one of the key factors lending some support.
Adding to this, a weaker tone surrounding Crude Oil prices undermined demand for the commodity-linked currency – Loonie and further collaborated towards limiting any meaningful slide, albeit Fed rate cut expectations might hold investors from placing any fresh bullish bets and keep a lid on any meaningful up-move.
Hence, it would be prudent to wait for a strong follow-through recovery before confirming that the recent corrective slide is over and positioning for the resumption of the prior bullish trajectory. The focus now shifts to the Fed Chair Jerome Powell’s scheduled speech, which might influence the USD price dynamics and eventually produce some meaningful trading opportunities later during the early North-America session.
Technical levels to watch
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