USD/CAD struggles to hold above 1.2700 ahead of US data
- USD/CAD is posting small daily losses on Monday.
- US Dollar Index stays flat on the day around 90.20.
- Mid-tier data releases will be featured in US economic docket.
The USD/CAD pair posted strong gains on Friday and closed the previous week virtually unchanged. At the start of the new week, the pair is struggling to make a decisive move in either direction. After rebounding above 1.2700 in the last hour, USD/CAD lost its momentum and was last seen losing 0.3% at 1.2693.
Rising oil prices boost CAD
During the early European session, the disappointing IFO data from Germany triggered a sharp decline in the EUR/USD pair and helped the greenback gather strength against its rivals. The US Dollar Index climbed above 90.30 with the initial market reaction but turned flat around 90.20 ahead of mid-tier macroeconomic data releases from the US.
German IFO’s Economist: Economy to stagnate in Q1 2021 amid little confidence.
Meanwhile, the barrel of West Texas Intermediate (WTI) is up 1.5% on the day and trading near $52.80, allowing the commodity-related loonie to outperform the USD.
Later in the day, the Chicago Fed National Activity Index and the Dallas Fed manufacturing Business Index will be featured in the US economic docket.
Meanwhile, the S&P 500 Futures are gaining 0.35%, suggesting that Wall Street's main indexes could start the day in the positive territory and force the USD to remain under bearish pressure in the second half of the day.
Technical levels to watch for