USD/CAD trades in the negative territory near 1.3710 on modest oil rebound
- USD/CAD failed to preserve its bullish momentum after closing higher on Thursday.
- WTI is staging a technical rebound on Friday.
- US Dollar Index is staying in the red ahead of inflation data.
The USD/CAD pair registered modest daily gains on Thursday and seems to have gone into a consolidation phase on Friday. As of writing, the pair was down 0.17% on a daily basis 1.3165. Despite the recent pullback, the pair remains on track to snap its six-week losing streak.
Oil rebound supports CAD
The selling pressure surrounding crude oil prices made it difficult for the commodity-sensitive loonie to find demand on Thursday. The barrel of West Texas Intermediate (WTI) lost more than 2% but started to erase its losses on Friday. At the moment, the WTI is up 1.05% on the day at $37.37, helping the CAD stay resilient against its major rivals.
Meanwhile, Bank of Canada Governor Tiff Macklem said on Thursday that the CAD's appreciation against the USD was less than other currencies but noted that they will take the exchange rate into account when assessing how much stimulus is needed.
On the other hand, the US Dollar Index edged lower on Friday but continues to hold above 93.00 ahead of the Consumer Price Index (CPI) data from the US.
The S&P 500 futures are up 0.9% ahead of Wall Street's opening bell and a decisive rally in US stocks could the USD to continue to lose interest as a safe-haven in the second half of the day.
Technical levels to watch for