USD/CAD trades sideways around 1.3570 in quiet day

• USD/CAD is trading in a tight range below 1.3600 on Friday.
• US Dollar Index is posting small daily gains near 97.30.
• WTI stays in a consolidation phase around $40.

The USD/CAD pair posted small daily losses on Thursday following the key macroeconomic data releases from the US and Canada. With the market action turning subdued on Friday, USD/CAD is fluctuating in a narrow band around 1.3570.

CAD stays resilient on upbeat data, rising crude oil prices

The report published by the US Bureau of Labor Statistics revealed that Nonfarm Payrolls in the US surged by 4.8 million in June to beat the market expectation of 3 million by a wide margin. Although the initial market reaction to this data caused the USD to weaken against its rivals, investors adopted a cautious stance amid the growing number of COVID-19 cases in the US. The US Dollar Index closed the day modestly higher at 97.21 and was last seen at 97.27.

On the other hand, Canada reported a smaller-than-expected international trade deficit and the Markit Manufacturing PMI improved sharply from 40.6 in May to 47.8 in June and provided a boost to the CAD. 

Meanwhile, rising crude oil prices helped the commodity-sensitive loonie outperform the greenback. The barrel of West Texas Intermediate gained more than 1% and registered its first daily close above $40 in 10 days on Thursday. At the moment, the WTI is down 0.3% on the day at $40.15, consolidating its weekly gains.

There won’t be any macroeconomic data releases in the remainder of the day and USD/CAD is likely to extend its sideways grind. On a weekly basis, the pair remains on track to snap its three-week winning streak.

Technical levels to watch for