USD/CAD slides back closer to Wednesday’s 2-1/2 week lows

   “¢   Disappointing ADP report does little to ease the USD bearish pressure.
   “¢   A modest retracement in oil prices also fails to lend any support.
   “¢   Next on tap would be the release of ISM PIM and FOMC meeting minutes.

The USD/CAD pair faded a knee-jerk bullish spike to an intraday high level of 1.3160 and moved back within striking distance of 2-1/2 week lows, set yesterday.

The US Dollar selling pressure remained unabated on Thursday and was further weighed down by weaker than expected US private sector employment details – ADP report, coming in to show an addition of 177K new jobs in June as compared to 190K expected and 178K previous.

Adding to the disappointment, the US initial weekly jobless claims unexpectedly rose to 231K during the week ended June 29 and exerted some additional downward pressure on the major.  

Meanwhile, traders seemed largely affected by a modest retracement in crude oil prices, which tends to derive demand for the commodity-linked currency – Loonie, with persistent USD selling bias turning out to be an exclusive driver of the pair’s slide over the past few hours.  

Today’s US economic docket also features the release of ISM non-manufacturing PMI and weekly crude oil inventories data, which coupled with the latest FOMC meeting minutes will play a key role in influencing the pair’s momentum ahead of Friday’s monthly jobs report from the US and Canada.  

Technical levels to watch

A follow-through selling, leading to a subsequent break below the 1.3100 handle, has the potential to continue dragging the pair further towards the 1.3065-60 intermediate support en-route the key 1.30 psychological mark.

On the flip side, the 1.3160 region now seems to have emerged as an immediate strong hurdle, above which a bout of short-covering could lift the pair towards the 1.3200 handle en-route weekly highs resistance near the 1.3225 area.