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USD/CAD off six-day highs, bid above 1.3150 amid WTI sell-off

  • USD/CAD hit multi-day highs amid a slide in WTI prices.
  • US dollar steady in recent ranges amid escalating covid concerns.
  • Next of relevance remains the US data and global virus statistics.

USD/CAD trades near the point of the 1.3100 level in early European trading, easing off the six-day highs reached at 1.3170 during late-Asia.

Despite the retracement, the spot remains well-bid while on track to book a 0.80% weekly gain this Friday.

The sentiment around the major remains underpinned by over 1.50% sell-off in the US oil, which weighs negatively on the resource-linked loonie. WTI drops below $40.50, “extending a two-day losing trend as concerns over rising coronavirus infection overshadowed reports of major producers mulling a delay in production ramp-up,” FXStreet’s Analyst Omkar Godbole noted.

Meanwhile, the US dollar remains sidelined, although clings onto the weekly gain against it main peers, collaborating with the upbeat tone seen in the spot. The greenback continues to draw haven bids amid mounting virus-induced economic risks and US fiscal stimulus impasse.

Amid a cautious market mood, the focus shifts towards the US PPI and Consumer Sentiment data, as the Canadian docket remains data-dry. Also, of note remains the covid statistics from both sides of the Atlantic for a fresh take on the risk sentiment and dollar trades.

USD/CAD technical levels

Bulls are “eyeing the 200-SMA level of 1.3186 as the next resistance before probing the 1.3200 threshold. On the contrary, USD/CAD sellers will wait for a clear downside break below the previous resistance line, presently around 1.3075, for fresh entries,” Anil Panchal, FXStreet’s Analyst explained.

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