USD/CAD retreats back below 1.3700 handle amid surging oil prices

The USD/CAD pair trimmed some of its early strong gains and has now dropped back below the 1.3700 handle, retreated over 50-pips from session tops.

Currently trading around 1.3680 level, the pair's latest leg of downslide could be attributed to the ongoing strong up-move in oil prices, which tends to benefit the commodity-linked currency - Loonie. In fact, the per barrel WTI oil prices added to previous session's sharp up-surge and has now moved above $48.00/barrel mark.

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Adding to this, the prevalent softer tone surrounding the US treasury bond yields has failed to extend any support to the US Dollar and further collaborated to the pair's retracement from higher levels. 

It, however, remains to be seen if the pair continues to find some fresh buying interest near weekly lows support around mid-1.3600s or soaring oil prices would end the pair's near-term bullish trajectory and trigger a near-term corrective slide.

Later during the day, the US macro data - PPI print and weekly jobless claims, along with the release of Canadian NHPI might provide some fresh trading impetus ahead of Fedspeaks.

Technical levels to watch

Immediate support remains near 1.3650-45 area, below which the pair to accelerate the slide towards the 1.3600 handle en-route 1.3575-70 horizontal support.

On the upside, momentum back above the 1.3700 handle might continue to confront some fresh supply near mid-1.3700s, which if cleared has the potential to lift the pair back towards reclaiming the 1.3800 round figure mark.