USD/CAD cracks 1.3500, fresh two-week lows ahead of Canadian data
- USD/CAD faces double whammy amid USD supply, WTI gains.
- Coronavirus vaccine hopes lift the market mood.
- Focus remains on virus stats and Canadian Retail Sales.
USD/CAD extends its Asian decline into the European session, now printing fresh two-week lows just below the 1.3500 level.
The spot sheds 0.25% and faces a double whammy, as the upbeat market mood dulls the safe-haven allure of the greenback while the appetite for the higher-yielding assets such as oil boosts the resource-linked CAD.
The overall risk sentiment is lifted, as investors cheer the European Union (EU) stimulus deal and hopes that the COVID-19 vaccine will be ready by end-2020. The S&P 500 futures (the risk gauge) is back above 3250 levels, adding 0.55% on a daily basis.
Meanwhile, the US oil benefits from the risk-on market profile, as markets remain expectant of a recovery in the fuel demand despite the new lockdowns worldwide. WTI rises 0.50% to trade at $41.15, at the time of writing.
Markets now await the Canadian Retail Sales data and the US virus stats for fresh trading impetus on the CAD pair. The broader market sentiment, however, will continue to play a pivotal role.
USD/CAD technical levels
The immediate support is seen at 1.3484 (June 23 low), below which the classic daily S3 at 1.3426 could be tested. On the flip side, the recovery will likely face stiff hurdle at 1.3514 (200-DMA). The next resistance is aligned at 1.3526 (daily high).
USD/CAD additional levels