USD/CAD faces rejection near 100-DMA, drops to session lows
- A sudden pickup in Oil prices underpinned the Loonie and exerted some pressure.
- The USD remains on the defensive despite the latest upsurge in the US bond yields.
The USD/CAD pair witnessed some selling during the early European session on Thursday and refreshed daily lows, around the 1.3165 region in the last hour.
The pair struggled to capitalize on its recent uptick and once again faced rejection near 100-day SMA, just ahead of the 1.3200 round figure mark amid a sudden pickup in Crude Oil prices, which tend to underpin demand for the commodity-linked currency – Loonie.
Weighed down by stronger Oil prices
Some optimistic trade-related comments by China's Commerce Ministry, saying that the US and China have agreed to cancel existing tariffs in different phases, led to a turnaround in the global risk sentiment and provided a goodish lift to perceived riskier assets – including Oil.
Meanwhile, the risk-on mood triggered a strong intraday upsurge in the US Treasury bond yields. The US Dollar, however, failed to attract any meaningful buying interest and did little to stall the pair's sharp intraday slide of around 30 pips over the past hour or so.
It will now be interesting to see if the pair is able to find any support at lower levels or continues with its intraday pullback from a key resistance amid relatively thin economic docket on Thursday – featuring the second-tier release of the usual initial weekly jobless claims from the US.
Technical levels to watch