USD/CAD picking up pace, around 1.3240

After bottoming out near 1.3210 during overnight trade, USD/CAD has managed to gain some buying interest and is now testing session highs in the 1.3240 area.

USD/CAD focus on data, API

The pair is looking to revert the negative start of the week, as yesterday’s up move to tops near 1.3330 lacked of follow through and triggered a cent-correction lower, always against the backdrop of a broad-based weaker greenback.

Spot seems to have decoupled from crude oil dynamics as of late, centering the attention instead on the US-CA yield differential, particularly after the recent steady stance from the Bank of Canada at its meeting last week.

That said, policy divergence between the Fed and the BoC appears as the main driver for the price action in the near term at least, while broader macro issues like the renegotiation of the NAFTA also emerges as a potential catalyst for prices.

Looking ahead, US Manufacturing PMI is due along with Existing Home Sales and the weekly report on US crude oil supplies by the API.

USD/CAD significant levels

As of writing the pair is gaining 0.01% at 1.3238 facing the next resistance at 1.3268 (20-day sma) followed by 1.3294 (100-day sma) and finally 1.3335 (high Jan.23). On the flip side, a breach of 1.3213 (low Jan.23) would aim for 1.3118 (200-day sma) and then 1.3078 (low Dec.14).