USD/CAD remains calm above 1.34

Following a slip to 1.3397, the USD/CAD pair rose back above 1.34 during the NA session. However, at the time of writing was still down 0.12% on the day at 1.3417.

CAD assisted by oil

Although the rising crude oil prices helped the CAD gain some strength against the greenback, the bearish momentum couldn't accelerate as the US Dollar Index was able to hold on to daily gains around 100.60. At the moment, the barrel of West Texas Intermediate is up 1.2% at $51.80. However, the recent rise witnessed in crude oil seems to be fragile as this week's reports showed that U.S. crude inventories remained at record highs. Robert Yawger, director of energy futures at Mizuho said that it was hard to justify the move on the on the back of fundamentals.

Monetary policy divergence

A recent poll by Reuters suggested that the CAD is poised to lose value against the greenback over the coming months pressured by an uncertain economic outlook and the prospect of higher interest rates in the United States.

• Reuters poll: Canadian dollar to weaken as policy path diverges with U.S.
• RBC CEO: Housing concerns could inhibit Canada's future economic growth

Technical outlook

The USD/CAD pair could encounter the first resistance at 1.3455 (Apr. 4 high) before 1.3500 (psychological level) and 1.3535 (Mar. 9 high). On the downside, supports align at 1.3400 (psychological level), 1.3320 (Mar. 29 low) and then 1.3285 (50-DMA).