USD/CAD well offered below 1.30 mark, hovering near 3-week low

Extending its downfall for fifth straight session, the USD/CAD pair is drifted further below 1.3000 psychological mark to currently trade near 3-weekly low level around 1.2965 region.

Maintaining its high degree of correlation with crude oil prices, the Canadian Dollar is benefitting from continuous rise in crude oil prices and exerting further selling pressure around the USD/CAD major. Comments from the Saudi oil minister about a possible action to stabilize oil prices has driven crude oil prices higher on Thursday and is boosting demand from commodity-linked currency, Loonie.

Moreover, persistent uncertainty surrounding the Federal Reserve’s monetary-policy outlook for the rest of 2016 is weighing on the greenback and contributing to the ongoing slide in the major. 

Focus now turns to today's US economic releases, including monthly retail sales data for the month of July, which could impact investors’ expectations for the Fed rate-hike action and would drive the pair in the near-term.

Currently trading just above 100-day SMA, the pair has now erased all of its gains recorded in the previous week. Hence, a follow through selling pressure would now open room for the pair ongoing slide. 

Technical levels to watch

From current levels, 100-day SMA near 1.2940 region seems to act as immediate support, which if broken seems to drag the pair immediately towards 1.2900-1.2890 horizontal support before the pair eventually drops to its next major support near 1.2840 area. 

On the flip side, any recovery now seems to confront immediate resistance near 1.3000-1.3020 zone, above which the recovery momentum could further get extended towards the very important 200-day SMA resistance near 1.3080-85 region.