USD/CAD stays calm near mid-1.33s as attention turns to PMI data
- Broad-based USD weakness causes the pair to lose its traction.
- WTI extends recovery to provide a boost to the loonie.
- Ivey PMI from Canada and ISM non-manufacturing PMI from the U.S. next.
The USD/CAD pair, which lost more than 100 pips in the second half of the previous week, started the week on a negative note and extended its slide as the greenback struggled to find demand and crude oil recovery helped the commodity-sensitive loonie gather strength. However, ahead of the critical PMI data from both Canada and the United States, the pair has gone into a consolidation phase and was last seen trading at 1.3352, losing 0.15% on a daily basis.
Following the drop to its lowest level in more than a year at $42.35 in the last week of the year, the West Texas Intermediate recorded its longest daily winning streak since June by closing every single day of 2019's first week in the positive territory. As of writing, the WTI was up 1.2% on the day at $48.80.
On the other hand, the US Dollar Index broke below the 96 handle and is now down 0.5% on the day at 95.72 while investors are waiting for the ISM non-manufacturing PMI, which is expected to retreat to 59 in December from 60.7 in November. Also in the session, the Richard Ivey School of Business is scheduled to release its PMI report as well.
Technical levels to consider
The pair could face the first technical support at 1.3320 (Dec. 12, 2018, low) ahead of 1.3255 (Dec. 7, 2018, low) and 1.3160 (Dec. 3, 2018 low). On the upside, resistances align at 1.3375 (daily high/50-DMA), 1.3420 (Dec. 17, 2018, high) and 1.3500 (psychological level/Jan. 4 high).