- USD/CAD wobbles in a 10-pips range around monthly top flashed on Friday.
- USD strength battles WTI moves amid a quiet session.
- Market sentiment dwindles during pre-Fed period, G7 refrained from surprises.
- Canadian Manufacturing Sales to decorate a light calendar.
USD/CAD takes rounds to 1.2160, keeping the range above 1.2155, amid Monday’s Asian session. In doing so, the Loonie pair remains sidelined around the monthly top amid an inactive session. Not only the lack of major data/events but mixed catalyst and off in Australia and China also restrict the pair’s moves of late.
Cautious sentiment ahead of this week’s Federal Open Market Committee (FOMC) put a bid under the US dollar and backs the USD/CAD buyers to extend Friday’s heavy gains. However, Canada’s key export item, WTI crude oil, remains firm near the late 2018 highs flashed on Friday and weighs on the quote.
An absence of any surprises from the Group of Seven (G7) meeting, concluded during the weekend, also adds to the market’s sluggish moves, weighing on the USD/CAD prices. That said, the G7 verdict pushes for a detailed investigation into the covid origins and harshly criticizes China over labor law infringement. Though, the global leaders’ push for more stimulus and vaccines seem to balance the mood.
Amid these plays, S&P 500 Futures print mild gains whereas the US 10-year Treasury yields remain unchanged. However, the US dollar index (DXY) keeps Friday’s gains at around 90.55.
Given the lack of fresh catalysts, today’s Canadian Manufacturing Sales for April, prior to 3.5%, could offer small moves to USD/CAD prices.
Technical analysis
A clear break of 21-day EMA, around 1.2123, directs USD/CAD buyers toward May 13 top near 1.2200.
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