USD/CAD jumps to 1.2550 as crude oil tumbles

The combination of a modest recovery of the US dollar across the board and the sharp decline in crude oil price boosted USD/CAD to the upside. The pair rose from 1.2485 to 1.2546, reaching the highest level since Friday. The greenback is rising against the Loonie for the second day in a row, the first time to do so, in three weeks. 

The sharp reversal in crude oil prices after six days of gains created the last impulse to the upside. The WTI barrel is at $48.60, down more than 3% for the day so far. Earlier today it was testing levels on top of $50.00. 

USD/CAD upside limited by data 

Before the recent spike, Canadian data offered resistance to the recent move. The Markit Manufacturing PMI came in at 55.5, above the 54.7 of June. 

Canada’s manufacturing sector maintained an impressive growth rate - Markit

The pair is correcting to the upside, after falling last week to 1.2411, the lowest level since June 2015. It has erased last week losses. On a wider perspective it still faces bearish pressure.  

Technical levels 

To the upside, resistance levels might be located at 1.2575 (Jul 19 low / Jul 27 high), 1.2610 (Jul 21 high) and 1.2660 (20-day moving average). On the flip side, support could be seen 1.2510/15 (Asian session high), 1.2450 (Aug 1 low) and 1.2410/15 (2017 lows).