USD/CAD flirting with tops near 1.3460

The greenback is now picking up further pace vs. its Canadian peer on Tuesday, lifting USD/CAD to the area of fresh daily highs in the 1.3450/60 band.

USD/CAD focus on US data

After two consecutive sessions with losses, the pair seems to have recovered the smile today, gathering some traction and prolonging the bounce off Friday’s lows in the 1.3420 region.

The offered bias around the buck appears mitigated during the first half of the week, although spot is expected to follow the usual broad-based consolidative mood pre-FOMC, while speculations on a potential Fed move tomorrow appear stabilized for the time being. According to CME Group’s FedWatch tool, the probability of a 25 bp rate hike is at 93% based on Fed Funds futures prices.

In the meantime, spot keeps trading in tandem with yield spread differentials between US and Canadian money markets, relegating crude oil dynamics as a secondary role when comes to drive the sentiment around the pair.

In the data space, US NFIB index is due followed by February’s Producer Prices and the weekly report on US crude stockpiles by the API.

USD/CAD significant levels

As of writing the pair is up 0.01% at 1.3447 and a break above 1.3536 (2017 high Mar.9) would aim for 1.3601 (high Dec.28 2016) and finally 1.3861 (high Feb.24 2016). On the flip side, the immediate support lines up at 1.3419 (low Mar.10) followed 1.3395 (low Mar.8) and then 1.3369 (low Mar.6).