USD/CAD trims gains as crude oil recovers ground

USD/CAD fell toward 1.3450 during the American session amid a modest recovery in crude oil price and a correction of the US dollar across the board. 

The WTI barrel is still down for the day but it managed to move off session lows. It dropped sharply from $48.50 to $47.25 hitting a fresh 3-month low after the release of production data from Saudi Arabia. Saudi officials said that they were not increasing supply to international markets, helping price move off lows. 

Also during the American session, the greenback reached fresh lows versus the Kiwi, the Aussie and the Yen and trimmed gains against European currencies. 

Correction but still pointing higher 

USD/CAD peaked at 1.3495 and then dropped to 1.3455, where it found support. Currently, it trades at 1.3470, 25 pips above the level it closed yesterday. 

Despite making a pull back from the highs, the intraday trend still points higher. The key support to the bullish outlook could be seen around 1.3440, where an uptrend line stands. A break lower could open the doors for a bigger slide, exposing 1.3400. 

To the upside, the immediate strong resistance is the 1.3500 area, followed then by last week highs that lie at 1.3535 (Mar 09 high).