USD/CAD drops below 1.2400 as crude oil prices gain traction
- USD/CAD reversed its direction after rising above 1.2400.
- WTI stays in the positive territory near $74.
- US Dollar Index continues to fluctuate above 92.00.
Following the two-day rally witnessed at the start of the week, the USD/CAD pair preserved its bullish momentum and reached its highest level in more than a week at 1.2424. However, the pair lost its traction ahead of the American session and was last seen losing 0.13% on the day at 1.2385.
WTI edges higher to $74
Rising crude oil prices seems to be helping the commodity-sensitive loonie gather strength against its rivals. Supported by a Reuters report claiming that OPEC+ is expected to discuss an extension to the oil output deal beyond April 2022, the barrel of West Texas Intermediate climbed to $74, rising nearly 1% on the day.
On the other hand, the greenback keeps a firm footing ahead of US data releases and limits USD/CAD's downside for the time being. Currently, the US Dollar Index is posting small daily gains at 92.10.
Later in the session, the Automatic Data Processing (ADP) Research Institute's monthly private-sector employment data will be looked upon for fresh impetus. Moreover, Industrial Product Price and Raw Material Price Index alongside April Gross Domestic Product (GDP) data will be featured in the Canadian economic docket.
Technical levels to watch for