USD/CAD turns to 1.37 as oil erases gains

Fueled by the solid performance of the greenback amid solid macro data, the USD/CAD jumped to its daily high at 1.3770 in the early NA session but quickly erased its gains as the rising crude oil prices gave the loonie a boost. However, as the barrel of WTI struggled to extend its gains, the pair found support at 1.3680 and rose to 1.37 area. As of writing, the pair was trading at 1.3699, up 0.3% on the day.

Today's macro data from the United States showed that the weekly jobless claims declined for the second week in a row and the total number of individuals who are currently receiving unemployment benefits fell to its lowest level since 1988 at 1,898,000. Other data revealed that the PPI rose more than expected. On the other hand, the Bank of Canada's Spring 2017 review didn't offer any insights on the economic outlook nor the monetary policy and was largely ignored by the participants.

• US: PPI for final demand advances 0.5% in April; services increase 0.4%, goods rise 0.5%

After touching its session high at $48.22, the barrel of West Texas Intermediate fell back below $48 in the last hour. Although there wasn't a clear catalyst behind that drop, profit-taking ahead of tomorrow's Baker Hughes data could have triggered a sell-off. 

Technical outlook

The pair could encounter the first support at 1.3645 (May 8 low) ahead of 1.3600 (psychological level/Dec. 28 high) and 1.3460 (50-DMA). On the upside, with a clean break above 1.3700 (psychological level), the pair could aim for 1.3735 (2016, Feb. 25 high) and 1.38 (psychological level).