USD/CAD erases daily gains, returns to 1.33 area on oil recovery
- Crude oil prices gain traction on Monday amid supply outlook.
- US Dollar Index consolidates below the 99 handle.
- Coming up: Speech by Fed Chairman Jerome Powell.
The USD/CAD came under modest selling pressure in the last hour as rising crude oil prices allowed the commodity-linked Loonie to gather strength against its rivals. The pair, which touched a session high of 1.3332, was last seen virtually unchanged on the day at 1.3315.
Political uncertainties in Middle-Eastern oil producers revived concerns over supply disruptions and provided a boost to crude oil prices on Monday. As of writing, the barrel of West Texas Intermediate was up 1.03% on a daily basis at $53.46.
On the other hand, after closing the previous week on a negative note following the uninspiring employment data from the United States, the US Dollar Index (DXY) started the week in a calm manner, allowing the CAD's market valuation to drive the pair's action.
Eyes on crude oil's performance
Federal Open Market Committee (FOMC) Chairman Jerome Powell's speech later in the session, which is unlikely to trigger a significant market reaction, the DXY is flat on the day at 98.85.
Meanwhile, markets will be paying close attention to any headlines coming out of the United States (US) - China trade talks in Washington. Any positive developments on that front could help crude oil prices to continue to push higher amid improved demand outlook and continue to weigh on the pair.
Technical levels to watch for