The USD/CAD pair recovered a few pips from over a two-week low
The USD/CAD pair recovered a few pips from over a two-week low touched earlier this Tuesday and was last seen trading just below mid-1.2800s, still down over 0.25% for the day. Bullish crude oil prices underpinned the commodity-linked loonie and dragged the USD/CAD pair lower for the third successive day. G7 leaders agreed to explore price caps on imports of Russian oil and gas, fueling supply concerns. Apart from this, the easing of COVID-19 curbs in China lifted hopes for demand recovery and lifted crude oil prices to a one-week high.
On the other hand, the US dollar made a solid comeback and snapped a two-day losing streak to over a one-week low amid a goodish pickup in the US Treasury bond yields. This, in turn, assisted the USD/CAD pair to find decent support near the 1.2820-1.2815 region and stall its intraday bearish trajectory, though any meaningful upside still seems elusive.
Hence, it will be prudent to wait for strong follow-through buying before confirming that the recent pullback from the YTD peak has run its course and placing fresh bullish bets around the USD/CAD pair. Market participants now look forward to the US economic docket - featuring the release of the Conference Board's Consumer Confidence Index and Richmond Manufacturing Index. The data, along with the US bond yields and the broader market risk sentiment, will drive the USD demand and provide some impetus to the USD/CAD pair. Traders will further take cues from oil price dynamics to grab short-term opportunities around the major. The focus, however, would remain on the OPEC+ meeting and Fed Chair Jerome Powell's appearance on Wednesday.
Hence, it will be prudent to wait for strong follow-through buying before confirming that the recent pullback from the YTD peak has run its course and placing fresh bullish bets around the USD/CAD pair. Market participants now look forward to the US economic docket - featuring the release of the Conference Board's Consumer Confidence Index and Richmond Manufacturing Index. The data, along with the US bond yields and the broader market risk sentiment, will drive the USD demand and provide some impetus to the USD/CAD pair. Traders will further take cues from oil price dynamics to grab short-term opportunities around the major. The focus, however, would remain on the OPEC+ meeting and Fed Chair Jerome Powell's appearance on Wednesday.