“¢ Retracing oil prices prompt fresh selling around commodity-linked Loonie.
“¢ Retracing USD/US bond yields does little to influence the price-action.
The USD/CAD pair continued gaining positive traction through the mid-European session and jumped back to the 1.2900 neighborhood.
The latest leg of a sharp spike over the past hour or so could be attributed to a sudden fall in crude oil prices, which seems to have prompted some weakness around the commodity-linked currency – Loonie.
Meanwhile, a weaker tone surrounding the US Dollar and the US Treasury bond yields, led by a dovish assessment of Wednesday’s FOMC meeting minutes, did little to influence the price-action, with oil price dynamics turning out to be an exclusive driver of the pair’s strong bid tone.
It, however, remains to be seen if the pair is able to build on the momentum or continues with its struggle to sustain its strength beyond the 1.2900 handle, which has been acting as a key hurdle over the past two-weeks.
Today’s US economic docket, featuring the release of usual initial weekly jobless claims and existing home sales data, along with Fedspeaks would now be looked upon for some fresh impetus during the NA trading session.
Technical levels to watch
On a sustained move beyond the 1.2900 round figure mark, the pair is likely to aim toward challenging the 1.2945-50 supply zone before eventually darting towards reclaiming the key 1.30 psychological mark.
On the flip side, retracement back below 1.2870 level might continue to find some fresh buying interest near the 1.2825-20 region (50-day SMA), which if broken might negate prospects for any further up-move.
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