USD/CAD stays in daily range above 1.2850

• US Dollar Index stages a technical correction on Thursday.
• Weekly jobless claims fall to 207K in the U.S.
• The barrel of WTI eases below $76.

The USD/CAD pair is struggling to find direction on Thursday as it continues to fluctuate in a tight 30-pip range. As of writing, the pair was virtually unchanged on the day at 1.2870.

After recording sharp losses during the first couple of days of the week, the pair staged a strong recovery on Thursday boosted by the strong performance of the greenback. The US Dollar Index, which advanced to a fresh 6-week high above 96 yesterday, has gone into a consolidation phase amid a lack of fundamental drivers. At the moment, the index is down 0.25% on the day at 95.75.

On the other hand, the crude oil rally that provided an additional boost to the commodity-sensitive loonie earlier this week seems to have come to a halt on Thursday with the barrel of West Texas Intermediate trading below the $76 mark and recording modest losses on a daily basis.

Later in the session, Ivey Purchasing Managers Index from Canada will be looked upon for fresh impetus. Moreover,    the U.S. Census Bureau is scheduled to publish the factory orders report, which is expected to show a 2.1% increase in August following July’s 0.8% contraction. Ahead of tomorrow’s important NFP report, however, the market reaction to these data is likely to stay limited.

Technical levels to consider

Resistances for the pair could be seen at 1.2890 (daily high), 1.2950 (200-DMA) and 1.3000 (psychological level). On the downside, supports are located at 1.2780 (Oct. 1 low), 1.2730 (May 11 low) and 1.2690 (Apr. 9 low).