USD/CAD flirting with 1.30 psychological mark

The USD/CAD pair came under renewed selling pressure on Thursday and has now moved on the brink of breaking below 1.30 psychological mark.

The pair on Thursday failed to build on to early tepid recovery move, which got an additional boost from impressive ADP report and upbeat US ISM manufacturing PMI, and revered from 1.3100 handle after the FOMC statement receded expectations of faster Fed rate-hike actions in 2017.

Against the backdrop of not so hawkish Fed, coupled with recent comment on strong dollar from the new Trump administration, triggered a fresh wave of US Dollar weakness on Thursday and collaborated to the pair's downslide on Thursday.

However, negative sentiment around oil markets, with WTI crude oil trading with modest losses, seems to assist the pair to hold above 1.30 mark, at least for the time being.

Later during NA session, the release of weekly jobless claims and prelim nonfarm productivity / labor cost from the US would now be looked upon to grab some short-term trading opportunities, ahead of the keenly watched NFP data on Friday. 

Technical levels to watch

Sustained weakness below 1.30 psychological mark is likely to accelerate the slide back towards nearly five-month lows support near 1.2970 region, touched on Tuesday. A follow through selling pressure below 1.2970 level would turn the pair vulnerable to extend its downward trajectory further towards 1.2930-25 horizontal support.

On the upside, recovery above 1.3030 level is likely to get extended towards session high resistance near 1.3050 region. A clear break above 1.3050 resistance now seems to assist the pair back towards reclaiming 1.3100 handle.