USD/CAD rises above 1.35 as WTI remains below $50

Following a slip to 1.3410, the USD/CAD pair gathered some bullish momentum during the mid-European session and was able to extend its gains into the NA session as the barrel of West Texas Intermediate remains below $50, hurting the demand for the loonie. At the moment, the pair is trading at 1.3520, up 0.12% on the day.

The increasing oil production output from the United States remains as the main drag on the price of crude oil. On Friday, the latest oil rig count from the United States revealed that the total number of active rigs increased to 688 (+5). Furthermore, there are still uncertainties surrounding a possible extension of the OPEC production cut agreement, as the OPEC members require a more substantial participation from non-members. As of writing, the WTI was trading at 49.25, down 0.71% on the day.

On the other hand, the US Dollar Index is making a fresh attempt to move above the 99 handle, allowing the pair to extend its gains.

On Monday, the latest data released by Statistics Canada revealed that the wholesale sales edged down 0.2% to $58.9 billion in February, following four consecutive monthly increases.

Technical outlook

The pair could face the immediate support at 1.3500 (psychological level) ahead of 1.3410 (daily low) and 1.3370 (50-DMA). To the upside, a break above 1.3535 (Mar. 9 high) could open the door to 1.3600 (psychological level/Dec. 28 high) and 1.3700 (psychological level).