USD/CAD spikes to session tops, around mid-1.3300s amid a sharp turnaround in oil prices

   “¢   Bulls once again showed some resilience below the 1.3300 round figure mark.
   “¢   A sharp fall in oil prices undermined Loonie and helped regain positive traction.
   “¢   Upbeat Canadian/softer US data did little to hinder the ongoing momentum.

The USD/CAD pair reversed an early dip back closer to near two-week lows and spiked to fresh session tops, around mid-1.3300s in the last hour.

For the third straight session, the pair showed some resilience at lower levels and once again managed to find decent support near the 1.3290-85 region and seemed rather unaffected by the prevalent US Dollar selling bias. A sudden turnaround in crude oil prices, which tend to underpin demand for the commodity-linked currency – Loonie, turned out to be one of the key factors behind the pair’s goodish intraday bounce of over 50-pips.

After climbing to fresh yearly highs, WTI crude oil witnessed a sharp intraday pull-back and has now drifted into the negative territory ahead of the publication of the usual weekly report on the US drilling activity by Baker Hughes. Concerns over US-China trade disputes resurfaced on news that the Trump-Xi meeting has been pushed back to April and prompted traders to take some profits off the table, especially after four consecutive days of strong gains.

On the economic data front, Canadian manufacturing sales rose 1% in January as against 0.4% expected, though did little to provide any meaningful boost to the Canadian Dollar. From the US, the Empire State Manufacturing Index drops to 3.7 in March as compared consensus estimates pointing to a reading of 10, but again failed to hinder the ongoing positive momentum.

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