USD/CAD consolidates the heaviest losses in two weeks above 1.2300
- USD/CAD portrays a corrective pullback following Friday’s heavy losses.
- WTI’s struggle amid mixed OPEC headlines, subdued market sentiment favor the bounce.
- China Caixin Services PMI, BOC Business Outlook Survey may entertain traders.
USD/CAD defends the 1.2300 threshold as traders lick their wounds after the heaviest losses in two weeks, flashed on Friday. That said, the Loonie pair prints a corrective pullback around 1.2330 as oil prices, Canada’s key export, dwindle amid mixed clues from the Organization of the Petroleum Exporting Countries (OPEC) members. Also contributing to the bounce is the subdued market condition amid a lack of fresh catalysts.
Having delayed the OPEC+ meeting the last week, oil producers are jostling over the much-anticipated output rise issues. Saudi Arabia and UAE seem to be on the contrasting end as far as the latest meeting is concerned. The indecision probes oil buyers and challenges the WTI up-moves around October 2018 highs.
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Elsewhere, market sentiment remains sluggish as the coronavirus (COVID-19) woes remain dominant in the Asia-Pacific region while the extended holidays in the US test momentum traders. Also, a light calendar adds to the USD/CAD pair’s consolidation. That said, S&P 500 Futures struggle to refresh the record top after the seven-day rally.
It’s worth noting that Friday’s US jobs report for June weakened the US dollar against major currencies. The USD/CAD pair also cheered upbeat oil prices to register the heaviest losses since June 21.
Looking forward, China’s Services PMI for June, expected 55.7 versus 55.1 prior, may offer immediate direction to the quote ahead of the Bank of Canada’s quarterly Business Outlook Survey. Above all, the US holiday may restrict the pair’s short-term moves but oil headlines can entertain the traders.
Technical analysis
Another failure to cross a downward sloping trend line from late January, around 1.2445-50, directs USD/CAD prices toward 50-day EMA near 1.2285.