USD/CAD rebounds modestly, posts small gains above 1.33
- Crude oil sell-off pauses on Thursday, WTI trades near $52.
- US Dollar Index moves sideways above 97.50 mark.
- Low-tier data are unlikely to impact pair's action today.
The USD/CAD pair closed the first three days of the week in the positive territory and touched its highest level since June 19 at 1.3344 as the sharp fall in crude oil prices weighed on the commodity-related Loonie. With the markets going into a consolidation phase on Thursday, the pair edged lower to 1.3280 area earlier in the day but struggled to gather bearish momentum. As of writing, the pair was up 0.05% on the day at 1.3307.
The upbeat trade data from China today mitigated fears over a dismal energy demand outlook in the world's second oil consumer and helped crude oil limit its losses. After dropping to its lowest level since mid-January at $50.50, the barrel of West Texas Intermediate retraced a small portion of this week's losses and was last seen trading at $52. Furthermore, a Saudi official today said concerns over demand growth were "overplayed," and added that Saudi Arabia's output will be 700,000 barrels per day less than August.
On the other hand, heightened odds of the Federal Reserve cutting its policy rate at least two more times before the end of the year are hurting the demand for the Greenback and not allowing the pair to push higher. At the moment, the US Dollar Index, which tracks the dollar's value against a basket of six major currencies, is down 0.06% on the day at 97.56.
Later in the day, the New Housing Price Index from Canada and the weekly Initial Jobless Claims data from the US will be looked upon for fresh impetus. In the meantime, participants will be keeping a close eye on oil prices.
Technical levels to watch for