USD/CAD struggling for direction amid higher oil prices

The USD/CAD pair tried hard to reverse part of yesterday's losses but ran through fresh offers just below 1.3400 handle and surrendered all of its daily gains.

Currently trading around 1.3365-70 band, nearly unchanged from yesterday's closing level, the pair reversed early spike to the vicinity of 1.3400 handle. Higher oil prices, with WTI crude oil holding comfortably above $53.00/barrel mark, is lending support to the commodity-linked currency - Loonie. Moreover, extension of the US Dollar's corrective slide, from yesterday's multi-year tops, was also seen contributing to some selling pressure around the major. 

The downslide, however, seems to have been limited for the time being, just above 50-day SMA immediate support, as investors awaited for the official EIA data on US crude stockpiles and provide fresh impetus in oil market and eventually drive the USD/CAD major. 

From the US, existing home sales data might trigger some short-term momentum play, but key focus would be on a flurry of important macro releases on Thursday, including CPI and monthly retail sales data from Canada, and final GDP print, durable goods orders from the US. 

Technical levels to watch

Immediate downside support is pegged at 50-day SMA near 1.3350 region, which if broken is likely to accelerate the slide towards weekly lows support near 1.3315 area ahead of 1.3300 round figure mark. On the upside, momentum above session peak resistance near 1.3385 level, leading to a subsequent strength above 1.3400 handle, is likely to lift the pair towards 1.3435 (yesterday's high) en-route 1.3465 (Nov. 30 high).