USD/CAD rises marginally, still points to the downside

• CAD holds to most of yesterday’s gains on the back of NAFTA positive expectations. 
• US Dollar trades mix despite positive US data. 

The USD/CAD pair is rising modestly on Wednesday and moved off highs during the US session. Despite today’s gains, it is validating yesterday’s sharp losses. The pair rose today from 1.2774 (lowest since Feb 28) and peaked at 1.2846. As of writing, it was trading at 1.2815/20.

On Tuesday USD/CAD lost more than a hundred pips, breaking key technical levels. Optimism about the outcome of NAFTA negotiations boosted the pair. Today, the loonie lost strength amid trade war fears and also following a slide in crude oil prices. Price peaked after the release of better-than-expected US employment data. 

Levels to watch 

So far today the pair has been unable to move significantly above 1.2820/30. If it manages to do so, it could remove part of the short-term bearish pressure. Above that level, the key resistance continues to be 1.2915/25, area that contains several daily highs and the 20—day moving average. A close on top, is likely to open the doors to more gains. 

On the flip side, below 1.2800 a test of the next support at 1.2780 seems possible; below the next key support might be seen at 1.2730.