USD/CAD clinches daily tops near 1.2860

• The Canadian Dollar depreciates to session lows in the 1.2860 region.
• USD is now bid and pushes DXY to fresh tops beyond the 89.00 handle.
• US Consumer Confidence next of relevance later in the NA session.

The buying interest seems to have woken up around the greenback and is now lifting USD/CAD to the area of daily tops in the 1.2880 region.

USD/CAD focused on risk trends, data

After two consecutive daily pullbacks, spot has now recovered the smile following a better tone around the greenback, which managed to rebound from lows in sub-89.00 levels when tracked by the US Dollar Index (DXY).

The recent rally in the risk-associated universe has been propping up the demand for the Canadian Dollar and thus helping the pair to prolong the correction lower from last week’s 2018 tops in the 1.3130 region. The down move, however, appears to have found decent contention in the low-1.2800s for the time being.

In the meantime, the US trade policy and the risk appetite trends remain as the almost exclusive drivers for the pair’s price action, at least in the near term. In the longer run, the data-dependent stance from both the Fed and the BoC and their implications on the rate path should rule the broader sentiment.

Later in the NA session, the S&P/Case-Shiller Index is next on tap seconded by March’s Consumer Confidence measured by the Conference Board. In addition, Atlanta Fed R.Bostic (voter, centrist) is also due to speak.

USD/CAD significant levels

As of writing the index is gaining 0.16% at 1.2863 facing the immediate up barrier at 1.2918 (21-day sma) seconded by 1.2969 (10-day sma) and then 1.3126 (2018 high Mar.19). On the flip side, a breach of 1.2803 (low Mar.12) would expose 1.2722 (38.2% Fibo of the 2017 drop) and finally 1.2647 (200-day sma).