The USD/CAD pair extended its sharp reversal move and has now slipped below mid-1.3500s, retreating over 100-pips from fresh 14-month tops touched earlier today.
The pair came under intense selling pressure on Thursday after the US President Donald Trump agreed not to terminate the NAFTA treaty at this time; forcing traders to aggressively cover their bearish bets against the Loonie.
Moreover, Wednesday’s disappointment from Trump’s much-awaited tax reforms was also seen weighing on the US Dollar and further collaborated to the heavily offered tone surrounding the major.
Meanwhile, market seems to have largely ignored weaker sentiment surrounding WTI crude oil prices, which derives demand for the commodity-linked currency – Loonie, albeit seems to limited additional downslide for the time being.
Today’s US economic docket features the release of monthly durable goods orders, weekly jobless claims, goods trade balance and pending home sales, later during the NA session and would be looked upon for some fresh impetus.
Technical levels to watch
A follow through weakness below 1.3535-30 immediate support is likely to drag the pair towards the key 1.35 psychological mark, en-route 1.3455-50 horizontal support. On the upside, any move back above 1.3570-75 area might now confront strong resistance near the 1.3600 handle, above which the pair is likely to resume its prior sharp appreciating move and aim back towards multi-month highs resistance near mid-1.3600s.