USD/CAD corrects from 4-week tops, CAD GDP/jobs data in focus
• Once again faces rejection above 1.29 handle.
• USD weakness/positive oil prices exerting pressure.
• Focus shifts to important macro data.
The USD/CAD pair came under some selling pressure on Friday and eroded all of the previous session's up-move to over 4-week tops.
On Thursday, the pair once again struggled to gain any follow through traction beyond the 1.2900 handle and has now snapped four consecutive sessions of winning streak amid some renewed US Dollar selling bias.
A delay in the Senate vote over the long-awaited US tax overhaul bill exerted fresh downward pressure on the greenback. This coupled with better-than-expected Canadian trade balance data underpinned the domestic currency and prompted some fresh selling at higher levels.
With the USD nursing overnight losses, a modest pickup in crude oil prices provided an additional boost to the commodity-linked currency - Loonie and further collaborated ot the pair's slide to session lows, around the 1.2860 region.
Today's economic docket, featuring the release of Canadian employment report and monthly GDP print should provide some impetus ahead of the US ISM manufacturing PMI. Meanwhile, speeches by influential FOMC member might also contribute to the pair's momentum on the last trading day of the week.
Technical levels to watch
A follow-through weakness below mid-1.2800s is likely to get extended towards 1.2820 horizontal support en-route the 1.2800 handle. On the upside, the 1.2900 handle remains the immediate strong hurdle, which if conquered could lift the pair beyond Oct. monthly highs resistance near the 1.2915 region towards the very important 200-day SMA barrier near the 1.2970 region.