USD/CAD fades the spike to 1.3460, returns near 1.3450

After climbing as high as the 1.3460 region earlier in the session, USD/CAD has now surrendered those gains and has returned to the negative ground in the 1.3450/45 band.

USD/CAD in multi-day lows

CAD stays firm vs. its American peer on Wednesday despite crude oil prices are shedding over 1% so far today and the bid tone is prevailing around the greenback.

In fact, the barrel of West Texas Intermediate is down more than 1% today, testing daily lows in the $47.60 region ahead of the EIA’s weekly report on US crude oil inventories.

When tracked by the US Dollar Index, the buck has reverted the initial pessimism and managed to regain the upper 96.00s in response to dovish headlines from the ECB ahead of its meeting tomorrow.

In the data space, Canadian Building Permits contracted 0.2% MoM in April, coming in below initial forecasts for a 2.4% gain.

In the meantime, spot is losing ground since Friday, coming under selling pressure after being rejected from tops in the mid-1.3500s.

Ahead in the week, Canadian Housing Starts are due tomorrow followed by the BoC’s FSR and the speech by Governor S.Poloz, while key labour market figures will be published on Friday.

USD/CAD significant levels

As of writing the pair is losing 0.06% at 1.3447 and a breach of 1.3426 (low Jun.7) would aim for 1.3385 (low May 25) and finally 1.3356 (76.4% Fibo of the April-May rally). On the upside, the next hurdle is located at 1.3496 (55-day sma) followed by 1.3525 (20-day sma) and then 1.3548 (high Jun.2).