- USD/CAD lacked any firm directional bias seesawed between tepid gains/minor losses on Wednesday.
- Some follow-through USD buying extended some support; a goodish bound in oil prices capped gains.
- Investors also seemed reluctant to place any aggressive bets ahead of the latest BoC policy decision.
The USD/CAD pair traded with a mild negative bias through the early European session and was last seen hovering near daily lows, around the 1.3230-35 region.
The pair failed to capitalize on its early uptick to over three-week tops, around the 1.3260 region, and now seems to have entered a bullish consolidation phase. A combination of diverging forces failed to provide any meaningful impetus and led to the subdued/range-bound price action on Wednesday.
The US dollar remained well supported on the back of some heavy selling around the British pound amid growing markets fears about a no-deal Brexit. The negative factor, to a larger extent, was offset by a goodish rebound in crude oil prices, which extended some support to the commodity-linked loonie.
Investors also seemed reluctant to place any aggressive bets ahead of the latest monetary policy update by the Bank of Canada (BoC). The BoC is scheduled to announce its decision later during the early North American session and is expected to leave interest rates unchanged at 0.25%.
Apart from this, the broader market risk sentiment will influence the greenback’s safe-haven status. This, coupled with oil price dynamics will play a key role in driving the USD/CAD pair and assist traders to grab some meaningful opportunities amid absent relevant US economic releases.
Technical levels to watch