USD/CAD pare losses, eyeing FOMC minutes for further direction

Having posted a session low at 1.3209, the USD/CAD pair has managed to recover some of its lost ground but remained in negative territory  and is currently trading around 1.3240-45 band.

Maintaining its high degree of correlation, the commodity-linked currency, loonie, is benefitting from the ongoing bullish momentum in WTI crude oil, which has now moved back above $51.00/barrel mark. However, rising prospects of at least one Fed rate-hike move in 2016 continues to underpin the greenback, assisting the pair to hold and rebound from closer to the very important 200-day SMA region.

While crude oil dynamics remains an important determinant of the pair's near-term momentum, today's release of FOMC meeting minutes, later during NY session, will also be looked upon to identify the pair's next leg of directional move. 

Also in focus would be the weekly API US crude stockpiles report, which would provide fresh impetus in oil prices and eventually drive the USD/CAD major, assisting traders to grab short-term trading opportunities.

Technical levels to watch

From current levels, 1.3260-65 zone (session high region) might act as immediate resistance above which the pair is likely to aim back towards reclaiming 1.3300 handle ahead of testing 1.3315 resistance level. On the flip side, 1.3205-1.3200 area (200-day SMA region) now becomes immediate strong support to defend, which if broken is likely to accelerate the slide immediately towards 1.3165-60 support before the pair eventually drops to 1.3110-1.3100 support zone.