USD/CAD sellers sneak in as trade-optimism confronts USD pullback

• USD/CAD fails to hold onto recovery gains as trade-positive headlines grab market attention.
• The US Dollar (USD) trims gains after Wednesday’s heavy run-up.
• US economic calendar, Fedspeak will be watched for fresh impulse, trade/political headlines could keep traders busy.

Not only recent declines of the USD but trade-positive news also trigger the USD/CAD pair’s pullback to 1.3260 during Thursday’s Asian session.

Having registered more than 1.0% gains on Wednesday, the US Dollar Index (DXY) grabs sellers’ attention as calls are on the hike for the US President Donald Trump’s impeachment.

The greenback also ignored upbeat statements from Robert Kaplan, president and CEO of the Federal Reserve Bank of Dallas.

The Canadian Dollar (CAD) buyers seem to have emphasized the positive statements concerning the US-China and US-Japan trade stories while also shrugging the WTI weakness off. Oil prices are on the back foot amid receding fears of supply outage from Saudi Arabia whereas recent increase in the US Oil Stocks, as reported by the weekly Energy Information Administration (EIA) release, added weakness to energy front.

The US economic calendar is likely to dominate during the later part of the day, mainly due to the existence of the Gross Domestic Product (GDP) release and scheduled Fedspeak. Also, trade/political headlines will keep entertaining momentum traders.

Technical Analysis

While 50-day simple moving average (SMA) level around 1.3240 acts as immediate support, a falling trend-line since September 03, at 1.3290 now, could limit pair’s near-term advances. It’s worth observing that 1.3200 and 1.3310 are likely additional filters after the quote breaks aforementioned levels.