USD/CAD struggles near 1.3400 mark amid rising oil prices, modest USD weakness

USD/CAD meets with some supply on Tuesday and snaps a three-day winning streak.
Recovering oil prices underpin the Loonie and act as a headwind amid a softer USD.
Recession fears, hawkish Fed expectations to limit losses for the USD and the major.

Haresh Menghani FXStreet

The USD/CAD pair comes under some selling pressure on Tuesday and snaps a three-day winning streak to over a two-week high, around the 1.3475 region touched the previous day. The pair maintains its offered tone through the first half of the European session and is currently placed near the daily low, just above the 1.3400 round-figure mark.

Crude Oil prices build on the overnight goodish rebound from a nearly two-month low and gain traction for the second straight day amid optimism over a recovery in fuel demand. This, in turn, underpins the commodity-linked Loonie, which, along with a modest US Dollar weakness, exerts downward pressure on the USD/CAD pair. That said, a combination of factors helps limit losses for the major, at least for the time being.

Worries about economic headwinds stemming from the worst yet COVID-19 outbreak in China and rapidly rising borrowing costs might continue to act as a headwind for the black liquid. Apart from this, fresh speculations that the Federal Reserve will stick to its hawkish stance should lend some support to the safe-haven Greenback. This, in turn, supports prospects for the emergence of some dip-buying around the USD/CAD pair.

Traders might also refrain from placing aggressive bets ahead of Fed Chair Jerome Powell and Bank of Canada Governor Tiff Macklem's scheduled speeches later during the North American session. Investors will look for fresh cues about the future rate-hike path, which, in turn, could determine the near-term trajectory for the USD/CAD pair. Apart from this, Oil price dynamics will be looked upon for some meaningful impetus.

Technical levels to watch

USD/CAD

Overview
Today last price	1.3412
Today Daily Change	-0.0031
Today Daily Change %	-0.23
Today daily open	1.3443

Trends
Daily SMA20	1.3383
Daily SMA50	1.3498
Daily SMA100	1.3536
Daily SMA200	1.3225

Levels
Previous Daily High	1.3476
Previous Daily Low	1.3397
Previous Weekly High	1.3472
Previous Weekly Low	1.3262
Previous Monthly High	1.3685
Previous Monthly Low	1.33
Daily Fibonacci 38.2%	1.3446
Daily Fibonacci 61.8%	1.3427
Daily Pivot Point S1	1.3401
Daily Pivot Point S2	1.3359
Daily Pivot Point S3	1.3322
Daily Pivot Point R1	1.348
Daily Pivot Point R2	1.3517
Daily Pivot Point R3	1.3559

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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