USD/CAD stays directionless, trades in narrow range below 1.2100
- USD/CAD is struggling to find direction on Tuesday.
- US Dollar Index clings to small gains above 90.00.
- WTI stays in a consolidation phase after renewing multi-year highs on Monday.
After closing the first day of the week little changed at 1.2079, the USD/CAD pair continues to move sideways on Tuesday and was last seen posting small daily losses at 1.2075.
Oil prices push lower after latest rally
On Monday, the barrel of West Texas Intermediate (WTI) touched its highest level since October 2018 at $69.97 but ended up closing the day with small losses at $69.20. Ahead of the American Petroleum Institue's (API) Weekly Crude Oil Stock data, WTI is down 1% at $68.50, making it difficult for the commodity-sensitive loonie to gather strength against its rivals.
On the other hand, the US Dollar Index (DXY) is fluctuating in a tight range above 90.00, not allowing USD/CAD to gain traction. Later in the session, Goods Trade Balance and JOLTS Job Openings data will be featured in the US economic docket. Statistics Canada will release the April International Merchandise Trade report as well.
Nevertheless, USD/CAD is unlikely to react to these data as investors wait for the Bank of Canada (BoC) to announced its policy decisions on Wednesday.
Bank of Canada Preview: QE reduction to continue later in 2021.
Meanwhile, Wall Street's main indexes look to open near Monday's closing levels as US stock futures trade little changed on the day.
Technical levels to watch for