USD/CAD down despite weak oil

Broad based USD weakness post Fed helped CAD score gains despite sharp losses in oil. USD/CAD pair dropped to a low of 1.3123 in Asia despite oil prices at three-month lows.

Focus on oil

Despite broad based USD selling, the main factor that could continue to influence the pair is oil. Both benchmarks are trading nearing three-month lows. Gasoline glut has derailed oil price recovery and thus pushed USD/CAD higher eight trading session before the momentum ran out of steam on Tuesday.

The pair was last seen trading around 1.3130 levels. Apart from oil prices, the pair could take cues from US advance goods trade balance data and weekly jobless claims due for release later today.

USD/CAD Technical Levels

A break below 1.3091 (10-DMA) would expose 50-DMA support of 1.297, under which 1.29 handle could be put to test. On the other hand, a break above 1.3168 (5-DMA) could yield 1.32. A violation there would expose 1.3254 (previous day’s high).