USD/CAD flirting with 200-DMA important support

Having posted a session high at 1.3220, the USD/CAD pair lost its upside momentum and erased all of its tepid recovery gains to currently trade with mild negative bias. 

Currently hovering around 200-day SMA, near 1.3195-90 band, the pair attempted a recovery following Thursday's sharp slide from above 1.3300 handle, weekly highs, led by recovery in crude oil prices and a corrective pause in the US Dollar. 

With Friday's release of upbeat Chinese inflation data, the greenback resumed its bullish momentum and helped the pair to rebound from the very important 200-day SMA. The recovery momentum, however, turned out to be short-lived amid renewed buying interest surrounding crude oil, which boosted demand for the commodity-linked currency - loonie.

Traders on Friday will focus on US economic data along with speeches from FOMC member Eric Rosengren and the Fed Chair Janet Yellen for fresh impetus, while oil price dynamics continuing to influence sentiment around the major. 

Technical levels to watch

On a sustained weakness below 1.3185 (200-day SMA), the pair seems to accelerate the slide immediately towards 1.3165-60 support area before heading towards weekly low support near 1.3140 level. 

On the flip side, any recovery attempt back above 1.3200 handle might now confront resistance near 1.3220 (session high) above which the pair seems to make a fresh attempt towards reclaiming 1.3300 handle.