“¢ Catches bids for the second straight session, despite some renewed USD weakness.
“¢ Bullish crude oil prices do little to underpin Loonie and prompt fresh selling.
“¢ Today’s release of ADP report/ISM services PMI eyed for fresh trading impetus.
The USD/CAD pair traded with a mild positive bias for the second consecutive session on Wednesday and is currently placed just a few pips away from overnight swing high.
With investors looking past the latest optimism over a last-minute US-Canada deal to replace NAFTA, the pair now seems to have found decent support near the 1.2800 handle and was largely unaffected by some renewed US Dollar selling bias.
Even a follow-through bullish momentum in crude oil prices, which tends to underpin demand for the commodity-linked Loonie, did little to prompt any fresh selling, with bulls taking cues from a goodish pickup in the US Treasury bond yields.
Despite the uptick, the recovery move lacked any strong conviction and remained capped below Monday’s bearish gap opening level as market participants now look forward to the US macroeconomic releases for some fresh impetus.
Today’s US economic docket features the release of the ADP report on private sector employment, which followed by the ISM non-manufacturing PMI should produce some meaningful trading opportunities later during the early North-American session.
The key focus, however, will be on Friday’s keenly watched US monthly jobs report, popularly known as NFP, which might influence the Fed rate hike expectations and help determine the next leg of directional move.
Technical levels to watch
Momentum beyond the 1.2840 immediate resistance is likely to confront some fresh supply near the 1.2870 region (200-day SMA), above which the pair is likely to aim towards reclaiming the 1.2900 handle.
On the flip side, the 1.2800 handle now seems to have emerged as an immediate support, which if broken is likely to accelerate the fall towards 1.2760-50 intermediate support en-route the 1.2700 handle.
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