USD/CAD - Will it sustain below 1.32?

Broad based USD selling could push the USD/CAD pair below 1.32 handle today, however, it remains to be seen if the spot holds below the same or recovers losses by day's end as seen in the last three trading sessions.

Oil is on the retreat

This is not good news for the Canadian dollar. Moreover, oil has priced-in almost all bullish news available out there in the markets. The focus now is on whether the OPEC members are playing by the rules of the game. Furthermore, there are signs of an increase in US supplies in response to higher prices.

Dollar sell-off could offer support

What could work in favor of the USD/CAD bears is the broad based weakness in the US dollar. Friday’s US wage growth numbers were strong; however, weakness in the USD on Monday and in the Asian session today suggests the USD has dropped from the trader’s wish list, at least in the short-run.

Overall, the probability of the pair closing the day below 1.32 is at the coin toss levels.

USD/CAD Technical Levels

The spot was last seen trading around 1.3205. A daily close below 1.32 would open doors for a sell-off to 1.3080 (Dec 14 low), under which the pair could test 1.30 (zero figure). On the higher side, violation at 1.3136 (session high) would expose resistance at 1.3277 (previous day’s high) and 1.33 (zero figure).