USD/CAD comfortable below 1.34 ahead of Fed

USD/CAD is back at square one on Wednesday, still unable to breakout its recent range as it consolidates near 7-month highs.

USD/CAD peaked at 1.3433 last Friday but failed to extend gains past that level and it was confined to a phase of consolidation. “Pressure from oil prices is offset by a CAD-positive narrowing in yield spreads—primarily driven by the broader tone of risk aversion following renewed uncertainty surrounding the U.S. election”, said Eric Theoret, Strategist at Scotiabank.

Focus now turns to FOMC decision at 18:00 GMT ahead of Friday’s dual employment releases.

USD/CAD levels to watch

At time of writing, USD/CAD is trading at 1.3393, virtually unchanged on the day. Immediate resistances are seen at 1.3433 (Oct 28 high), 1.3445 (Mar 9 high) and 1.3498/1.3500 (Mar 2 high/psychological level). On the flip side, supports could be found at 1.3353 (10-day SMA), 1.3300 (psychological level) and 1.3276 (Oct 25 low).