USD/CAD slides back closer to mid-1.3000s, focus shifts to Canadian CPI
- The USD fails to capitalize on the overnight up-move amid sliding US bond yields.
- Oil prices now seemed to have stabilized and extended some support to the Loonie.
- The focus now shifts to Canadian consumer inflation and US housing market data.
The USD/CAD pair came under some renewed selling pressure on Wednesday and eroded a part of the previous session's goodish up-move to one-week tops.
A combination of supporting factors helped the pair to build on its overnight bounce from yearly lows and post strong gains on Tuesday - marking its second consecutive day of a positive move.
Renewed US Dollar buying interest picked up the pace after June US retail sales figures surpassed market estimates and forced investors to scale back expectations for an aggressive policy easing by the Fed.
This coupled with a selloff in Crude Oil prices weighed heavily on the commodity-linked currency - Loonie and further collaborated to the pair's strong intraday up-move of around 70-pips, closer to the 1.3100 handle.
The positive momentum, however, started losing steam during the Asian session on Wednesday amid a fresh leg of a downfall in the US Treasury bond yields, which kept a lid on any subsequent up-move for the greenback.
Currently hovering around the 1.3065-60 region, the slide could further be attributed to some repositioning trade ahead of Wednesday's important release of the latest consumer inflation figures from Canada.
From the US, the release of housing market data - building permits and housing starts, might influence the USD price dynamics and further collaborate towards producing some meaningful trading opportunities.
Technical levels to watch