USD/CAD benefits from bullish DXY & weaker Oil

The US dollar extends the rebound versus its Canadian counterpart into a second day this Tuesday, sending USD/CAD through the roof in a bid to regain 1.32 handle.

USD/CAD takes-out all major DMAs

Currently, the USD/CAD pair rises +0.36% to 1.3167, trying another attempt to break above 1.3175 resistances. The resource-linked Loonie suffers from the extended correction in oil prices, driving USD/CAD northwards.

Moreover, persistent broad based US dollar strength, mainly triggered by a massive sell-off in GBP/USD amid jitters surrounding Brexit process, also adds to the upside in the major. The US dollar index (DXY), a gauge of greenback’s relative strength, advances +0.55% to fresh two-week tops of 96.21.

Looking ahead, focus shifts towards the US and Canadian employment reports due later this week for next direction on the prices. While oil price-action will be also closely eyed, in light of weekly US supply reports due on the cards.

USD/CAD Technical Levels

To the upside, the next resistances are seen near 1.3186 (Sept 29 high) and 1.3200 (round figure) and from there to 1.3250 (psychological levels). To the downside, immediate support might be located at 1.3151 (10 & 20-DMA) and below that at 1.3100 (round number) and at 1.3044 (Sept 29 low).