USD/CAD: reversal from 50-DMA extends further below 1.2850

The USD/CAD pair remained well offered and is now extending its reversal from 50-day SMA region to currently trade at session low level.

The Canadian Dollar was well bid against its US counterpart despite crude oil lost upside momentum and turned flat as investors wait for fresh impetus from today's EIA report on weekly US crude oil inventories.

Moreover, short-term traders might be willing to take some profit off the table after over 200-pips of up-move in the previous three-days and ahead of the much awaited outcome of the FOMC June meeting, later during NY session.

Markets already seems to have discounted a status-quo, but what would of key interest for market participants is the number of rate-hikes expected in 2016 and likelihood of a interest rate-hike in July.

Technical levels to watch

Should the ongoing weakness drag the pair below 1.2800 handle, the pair is likely to extend the weakening trend towards Monday's low support near 1.2750 before eventually dropping back below 1.2700 level to test 1.2690-85 support area.

Meanwhile on the upside, 50-day SMA near 1.2875-80 region remains immediate hurdle to clear, which if conquered should assist the pair break through 1.2900 handle and head towards its next major resistance near 1.2955-60 horizontal area.