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USD/CAD reverses losses and hits fresh highs

FXStreet (Córdoba) - USD/CAD picked up pace and advanced to fresh daily highs after data showed Canadian wholesale sales came in below expectations in July.

Canadian wholesale sales stood flat in July against expectations of a 0.8% rise and down from a 1.3% increase the previous month. The loonie weakened after the data and reversed early gains versus the greenback.

USD/CAD bounced from a low of 1.3175 and climbed to a high of 1.3232 in recent dealings. At time of writing, the pair is trading at 1.3230, virtually unchanged since opening.

Later on the session, Bank of Canada Governor Stephen S. Poloz speaks before the Calgary Economic Development.

USD/CAD technical view

“Friday’s collapse in oil price proved to be the catalyst that sank USDCAD nearly two big figures lower before finding support around the 1.3020 area and eventually rebounding higher to close above the open. This is constructive for USDCAD in our view and we remain medium-term bulls”, said the TD Securities team.

“We think playing the range remains an effective strategy for now until a policy-induced catalyst emerges (either from the BoC or the Fed). We view the 1.2880/1.2900 area (post-BoC July cut) as strong support for funds”, TD analysts commented. “Near-term support comes in around the 1.3100/1.3150 area. We would look to buy the dip on a break below the figure”.

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