USD/CAD taps 1.34 handle and retreats after BOC's business outlook survey

The USD/CAD pair built on to its recovery momentum from sub-1.3300 level and spiked to multi-day tops during early NA session. The pair, however, failed to move past the 1.3400 handle and retreated few pips to currently trade around 1.3370-75 region.

A mild softer tone surrounding oil market, with WTI crude oil retreating from 4-week highs, weighed on the commodity-linked currency - Loonie, and triggered the initial leg of recovery move from 100-day SMA important support. 

Moreover, possibilities of some stops being triggered, on a sustained move above 1.3355-60 horizontal resistance, could have been one of the reasons collaborating to the pair's sharp up-move in the past hour or so.

Meanwhile, markets seem to have largely ignored the Canadian manufacturing PMI print, while a slightly better-than-expected US ISM manufacturing PMI print for the month of March also remained supportive of the strong bid tone surrounding the major. 

However, the release of upbeat BOC's business outlook survey report extended some support to the Canadian Dollar and stalled the pair's up-move around the 1.3400 handle. Focus now shifts to speeches by various FOMC members - New York Fed President William Dudley, Philadelphia Fed President Patrick Harker and Richmond Fed President Jeffrey Lacker. 

Technical levels to watch

On a sustained move above the 1.3400 handle, leading to a subsequent break through 1.3415 (March 28 high), the pair is likely to accelerate the appreciating move towards 1.3440 horizontal resistance ahead of 1.3475-80 strong hurdle.

On the downside, retracement back below mid-1.3300s might now find immediate support near 1.3320-15 area, below which the pair is likely to head back towards retesting 100-day SMA support near 1.3300-1.3295 region.