USD/CAD extends recovery move, 1.37 back on sight

The USD/CAD pair was seen building on to early tepid recovery move and is currently placed at fresh session tops near 1.3685 level.

A fresh wave of US Dollar buying interest, primarily led by a sharp profit taking slide in the EUR/USD major, seems to be a key factor helping the pair to recover part of steep losses recorded on Friday. Against the backdrop of Friday's US monthly jobs report, growing bets for an eventual June Fed rate-hike action also underpinned the greenback demand and lifted the key US Dollar Index to daily peaks near 98.75-80 band. 

Adding to this, a modest retracement in the US treasury bond yields, pointing to a slight deterioration in investors' risk-appetite, also boosted the bucks safe-haven appeal against its Canadian counterpart. 

Moreover, a sharp retracement in oil prices, with WTI crude oil reversing majority of its early gains and retracing back closer to the $46.00/barrel mark, further dented demand for the commodity-linked currency - Loonie, and collaborated to the pair's recovery move.

Today's economic docket lacks any major fundamental drivers and hence, focus would be on a speech by the St. Louis Fed President James Bullard, while oil price-dynamics would continue to play an important role in determining the pair's movement on Monday. 

Technical levels to watch

A follow through momentum above the 1.3700 handle could lift the pair back towards 1.3725 intermediate resistance ahead of the next major hurdle near 1.3750 region. On the downside, 1.3650-45 area now seems to have emerged as immediate support, below which a fresh leg of corrective slide could drag the pair below the 1.3600 handle towards its next support near 1.3575-70 region.