USD/CAD rebounds swiftly from 1.2100 mark amid a sharp fall in oil prices

USD/CAD attracted some dip-buying on Wednesday and turned positive for the second straight day.
An intraday turnaround in oil prices undermined the loonie and remained supportive of the uptick.
Retreating US bond yields kept the USD bulls on the defensive and capped the upside for the main .
The USD/CAD pair rallied over 35 pips from the first European session lows and jumped back to the highest end of its daily trading range, round the 1.2135-40 region within the last hour.

The pair attracted some dip-buying near the 1.2100 round-figure mark and might now be looking to create on the recent bounce move from rock bottom level since May 2015 touched earlier in the week the newest leg of a sudden spike over the past hour approximately might be attributed to a fresh leg down in petroleum prices, which tend to undermine demand for the commodity-linked loonie.

WTI petroleum did not maximize the intraday uptick, instead witnessed a turnaround from the $64.00 neighbourhood and dived closer to three-week lows set within the previous day. Worries that surging COVID-19 cases and therefore the imposition of the latest restrictive measures in some Asian countries would hinder fragile fuel demand recovery continued acting as a headwind for the commodity.

That said, the emergence of some fresh selling around the US dollar might keep a lid on any meaningful upside for the USD/CAD pair, a minimum of for the nonce. Despite hints that the Fed has begun debating on QE tapering, the USD struggled to realize any meaningful traction amid a pointy pullback within the US Treasury bond yields. This, in turn, might cap gains for the USD/CAD pair.

Hence, it’ll be prudent to attend for a few strong follow-through buying before confirming that the USD/CAD pair has bottomed call at the near term and positioning for any meaningful recovery. Market participants now anticipate the US economic docket – featuring the discharge of the Philly Fed Manufacturing Index and Initial Weekly Jobless Claims – for a fresh impetus.

Apart from this, the US bond yields will influence the USD. Traders will further take cues from a scheduled speech by the Bank of Canada Governor Tiff Macklem and oil price to grab some short-term opportunities round the USD/CAD pair.

Technical levels to observe
USD/CAD
OVERVIEW
Today last price 1.2134
Today Daily Change 0.0002
Today Daily Change % 0.02
Today daily open 1.2132

TRENDS
Daily SMA20 1.2234
Daily SMA50 1.2417
Daily SMA100 1.2558
Daily SMA200 1.2825

LEVELS
Previous Daily High 1.2143
Previous Daily Low 1.2054
Previous Weekly High 1.2203
Previous Weekly Low 1.2046
Previous Monthly High 1.2654
Previous Monthly Low 1.2266
Daily Fibonacci 38.2% 1.2109
Daily Fibonacci 61.8% 1.2088
Daily Pivot Point S1 1.2077
Daily Pivot Point S2 1.2021
Daily Pivot Point S3 1.1988
Daily Pivot Point R1 1.2166
Daily Pivot Point R2 1.2199
Daily Pivot Point R3 1.2255

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