USD/CAD trades with modest losses, just below 1.3200 handle
- A pickup in Crude Oil prices underpinned Loonie and exerted some pressure.
- A modest rebound in the US bond yields/USD helped limit further downside.
- Investors look forward to Fedspeaks for some short-term trading impetus.
The USD/CAD pair traded with a mild negative bias through the early European session on Tuesday, albeit remained well within a broader trading band held over the past four sessions.
The pair continued with its struggle to sustain/build on its momentum beyond 50-day SMA resistance near the 1.3200 round figure mark and was being weighed down by a mildly positive tone around Crude Oil prices, which tend to underpin demand for the commodity-linked currency - Loonie.
Despite growing market concerns over the recent escalation in the US-China trade dispute, the fact that PBOC set the Yuan fixing stronger than expected on Tuesday helped boost investors' appetite for riskier assets and turned out to be one of the key factors that drove oil prices higher on Tuesday.
Meanwhile, a slight improvement in the global risk sentiment - as depicted by a mildly positive tone around equity markets, led to a modest rebound in the US Treasury bond yields, which extended some support to the US Dollar and helped limit any meaningful downside, at least for the time being.
It would now be interesting to see if the pair is able to attract any fresh buying interest or the range-bound price action marks the end of the recent corrective bounce amid absent relevant market-moving economic releases, though scheduled speeches by influential FOMC members might provide some short-term trading impetus.
Technical levels to watch