Wednesday saw crude oil sold off for the third consecutive day which again saw the commodity linked Loonie weaken across the board. USD/CAD managed to rise above the key 1.32 handle on the day, the first time it has broken this resistance since January 30. As of writing, USD/CAD is currently trading sightly lower, oscillating around the 1.3185 handle.
On the data front, Ivey PMI numbers out of the domestic economy came in at a seasonally adjusted 54.7 for January, well below market expectations of 56. The miss obviously weighed on the CAD, forcing it lower in the lead up to Friday’s vital labour market report.
Given recent moves, we still see first lines of technical resistance at the 1.3200 handle, with moves beyond this figure expected to meet further resistance approaching the Jan 30 high of 1.3280. On the downside, supports are evident at the daily low of 1.3125 before the Feb 2 low of 1.3070.