USD/CAD drops to 2-week lows, closer to 1.28 mark

   •  USD fails to find any buyers despite supportive factors.
   •  Positive oil prices underpin commodity-linked Loonie.

The USD/CAD pair continued losing ground on Tuesday and has now dropped to 2-week lows, inching closer to the 1.2810-1.2800 support area.

Despite easing fears about a disruptive US-China trade war and some renewed uptick in the US Treasury bond yields, the US Dollar struggled to find any buyers and did little to stall the pair's fall for the third straight session. 

Adding to this, a mildly positive sentiment around crude oil prices provided an additional boost to the commodity-linked currency - Loonie and further collaborated to the pair's slide for the sixth day in the previous seven.

It would now be interesting to see if bulls are able to defend the 1.2800 handle or the pair extends its sharp retracement slide from near 9-month highs, set earlier this month. 

Traders now look forward to the US economic docket, highlighting the release of CB's Consumer Confidence Index, and Atlanta Fed President Raphael Bostic's speech for some fresh impetus later in the day. 

Technical levels to watch

On a sustained weakness below the 1.2800 mark, a fresh wave of technical selling might continue dragging the pair further towards the 1.2700 handle with some intermediate support near the 1.2765 region. On the upside, the 1.2855-60 region now seems to act as an immediate resistance, above which a bout of short-covering could lift the pair back towards reclaiming the 1.2900 handle.