- ISM NY Business Conditions Index showed strong improvement in July.
- US Dollar Index tests 95 in the NA session.
- WTI sticks to small recovery gains to limit the pair’s upside.
After recording losses in the last three days, the USD/CAD pair gained traction on Thursday and touched a session high at 1.3040 before erasing some its daily gains. At the moment, the pair is up 0.1% on the day at 1.3015.
The report released by the ISM NY showed that the Business Conditions Index, a good indicator of the overall health of manufacturers and non-manufacturing firms/organizations doing business in the New York area, improved to 75 in July from 55 in June. Furthermore, following May’s 0.4% growth, factory orders increased 0.7% on a monthly basis in June. Earlier in the session, the weekly report revealed that initial jobless claims ticked up to 218K for the week ending July 27.
The US Dollar Index, which failed to hold above the 95 mark during the European trading hours, started to gather strength on the upbeat data and is now testing the 95 handle while adding 0.35% on the day.
In the meantime, following a drop to a fresh 5-week low at $66.90, the barrel of WTI staged a decisive recovery to help the commodity-sensitive loonie show resilience against the buck. As of writing, the barrel of WTI was up 50 cents on the day at $68.30.
There won’t be any other macroeconomic data releases in the remainder of the day and investors will be waiting for tomorrow’s NFP report.
Technical outlook
The pair could face the first support at 1.3000 (psychological level) ahead of 1.2970 (100-DMA) and 1.2920 (Jun. 8 low). On the upside, resistances align at 1.3040 (daily high), 1.3115 (20-DMA) and 1.3180 (Jul. 23 high).
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