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  • WTI pullback triggered recovery from 50-day SMA.
  • Canadian retail sales and FOMC minutes are in the spotlight.

Noises surrounding the US-Iran relations and optimism concerning the removal of metal tariffs pleased USD/CAD sellers recently, the pair took a U-turn from 50-day SMA on early Wednesday as crude prices slip while traders await monthly Canadian retail sales data.

Crude is the largest export item of Canada and has a positive correlation with the Canadian Dollar (CAD). The energy benchmark was on rising earlier as deteriorating political relations between the US and Iran signaled a war.

However, a surprise increase in the weekly US crude oil stocks data from the American Petroleum Institute (API) joined hands with the absence of further Geopolitical salvo to drag the black gold down off-late.

It should also be noted the latest headlines relating to the trade negotiations between the US and China also directed near-term Loonie moves.

Investors will now focus on the March month retail sales data for fresh impulse whereas minutes of the latest FOMC meeting could also offer directives to price sentiment.

Canadian retail sales may increase 1.1% against 0.8% prior with the retail sales ex-Autos, also known as core retail sales, likely rising 0.9% over 0.6% earlier.

Minutes of the latest Federal Open Market Committee (FOMC)  meeting is less likely to offer any news guidelines for future policy moves. However, details for a number of policymakers in support of a rate change will be observed closely.

Technical Analysis

Not only 50-day simple moving average (SMA) level of 1.3400 but an upward sloping trend-line since February 27 can also question the pair’s downside at 1.3380, if not then 100-day SMA level of 1.3330 might lure sellers.

On the upside, 1.3440, 1.3500 and an ascending trend-line joining highs since January 07 at 1.3555 could limit the quote’s advances.