USD/CAD wobbles around 1.3400 ahead of BoC

The Canadian dollar is clinging to its daily gains vs. its American neighbor on Wednesday, with USD/CAD gyrating around the key 1.3400 handle.

USD/CAD focus on the BoC

The recent upside in the pair seems to be taking a breather today, as spot is looking to stabilize around 1.3400 the figure after hitting overnight tops near 1.3450. The greenback is surrendering part of yesterday’s strong gains after bottoming out in sub-1.3300 levels, or 4-month lows, in a context favourable to the risk-associated space.

Absent releases in the US docket and with crude oil prices extending its sideline pattern, the BoC monetary policy meeting will be in the limelight later in the NA session. However, expectations of a change in the recent tone by the central bank remain muted, as no press conference or MPR are expected today.

USD/CAD significant levels

As of writing the pair is retreating 0.08% at 1.3406 and a break below 1.3307 (200-day sma) would open the door to 1.3259 (2016 low Mar.7) and finally 1.3034 (low Nov.3 2015). On the other hand, the immediate resistance aligns at 1.3603 (20-day sma) followed by 1.3679 (100-day sma) and then 1.3861 (high Feb.24).

Oil rallies, Brent trades above $40

Oil strengthened on both sides of the Atlantic, with Brent rising above $40/barrel on the back of risk-on trading in Europe and prospects of production freeze by major oil producers.
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