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  • WTI recovers toward $57 area.
  • Broad USD strength on Thursday doesn’t allow the pair to post losses.
  • US Dollar Index surges to highest level since mid-December.

The USD/CAD pair rose to its highest level since early January on Wednesday at 1.3457 and spent the first half of the day retracing a small part of its recent rally. However, with the greenback outperforming its major rivals, the pair pulled away from the daily low that it set at 1.3412 and turned positive on the day. As of writing, the pair was trading at 1.3448, adding 0.06% on a daily basis.

After posting modest losses on Tuesday and Wednesday, crude oil prices gained traction today and the barrel of West Texas Intermediate recovered to $57 area to help the commodity-sensitive loonie find demand earlier in the day. At the moment, WTI is up nearly 1% on the day at $56.70.

On the other hand, the selling pressure surrounding major European currencies allowed the buck to gather strength on Thursday. The dovish shift in the ECB’s policy outlook reminded investors of the diverging monetary policies between the Fed and other major central banks. In its policy statement, the ECB announced that it was expecting to keep the interest rate steady at least until the end of the year and slashed its 2019 growth forecast to 1.1% from 1.7% seen in December.

The US Dollar Index rose to its highest level since December 17 at 97.50 and was last seen at 97.46, gaining 0.6%. Meanwhile, today’s data from the U.S. revealed that weekly jobless claims decreased by 3,000 to 223,000 in the week ending February 25 and the unit labour costs rose by 2% in the fourth quarter to surpass the analysts’ estimate of 1.6%.

Technical levels to consider

USD/CAD

Trends:
       Daily SMA20:  1.3248
       Daily SMA50:  1.3291
       Daily SMA100:  1.3282
       Daily SMA200:  1.3172
Levels:
       Previous Daily High:  1.3458
       Previous Daily Low:  1.3344
       Previous Weekly High:  1.3308
       Previous Weekly Low:  1.3112
       Previous Monthly High:  1.3341
       Previous Monthly Low:  1.3069
       Daily Fibonacci 38.2%:  1.3414
       Daily Fibonacci 61.8%:  1.3388
       Daily Pivot Point S1:  1.3367
       Daily Pivot Point S2:  1.3299
       Daily Pivot Point S3:  1.3254
       Daily Pivot Point R1:  1.348
       Daily Pivot Point R2:  1.3525
       Daily Pivot Point R3:  1.3593