USD/CAD bounces off lows, regains 1.3070/75 on OPEC deal

The Canadian dollar is trading almost unchanged vs. its American peer on Thursday, with USD/CAD regaining some pips after bottoming out in the mid-1.3000s.

USD/CAD focus on oil

The pair is looking to stabilize around the lower end of the recent range, shedding around 2 cents since yesterday’s tops near 1.3250 to overnight lows in the mid-1.3000s.

CAD met a wave of buying interest after OPEC members agreed to a preliminary deal to cut oil productions for the first time in eight years, lifting the barrel of West Texas Intermediate to levels above the $47.00 mark. The deal should be formalized at the OPEC meeting in November.

On the USD side, KC Head E.George (the most hawkish FOMC member) said the Fed needs to hike rates ‘slowly but surely’. It is worth recalling that E.George was one of the triple-dissenters favouring a rate hike at the last FOMC meeting.

On the data front, US final Q2 GDP figures is due ahead of Initial Claims, Pending Home Sales and Core PCE. In addition, FOMC members Lockhart, Powell. Kashkari, George and Chair Yellen are due to speak later in the NA session.

USD/CAD significant levels

As of writing the pair is losing 0.02% at 1.3078 facing the next support at 1.2996 (low Sep.22) ahead of 1.2818 (low Sep.7) and then 1.2759 (low Aug.18). On the other hand a break above 1.3276 (high Sep.27) would open the door to 1.3311 (38.2% Fibo of the 2016 drop) and finally 1.3575 (50% Fibo of the 2016 drop).