USD/CAD bounces-off session low as oil retreats

The USD/CAD pair has managed to bounce-off session lows but remained confined in a narrow trading band, closer to nearly 7-week low touched in the previous trading session. 

Currently trading in neutral territory, around 1.3270 region, retracing crude oil prices, with WTI crude oil now trading with a weakness of over 1%, is seen weighing on the commodity-linked currency - Loonie and contributing to the pair's recovery from session low. A strong rally in crude oil, in wake of last week's OPEC deal to cut its oil output, provided an additional boost to the Canadian Dollar. The coupled with a corrective slide in the greenback, as measured by the overall US Dollar Index, has led to the pair's corrective slide of over 200-pips in the past three trading session. 

Later during NA session, Canadian trade balance data accompanied by US economic docket that includes - revised non-farm productivity, trade balance data and factory orders, would be looked upon for short-term trading impetus. Meanwhile, the broader trend would continue to be driven by US price dynamics, on market expectations over the Fed's monetary policy stance, and sentiment surrounding crude oil prices.

Technical levels to watch

Immediate downside support is pegged at 1.3250 region (session low) below which the pair is likely to aim towards testing 100-day SMA support near 1.3190 region. On the upside, momentum above session peak resistance near 1.3285 is likely to get extended towards 1.3300 round figure mark ahead of 50-day SMA support break-point, now turned resistance, near 1.3325-30 region.