USD/CAD hits fresh weekly lows at 1.2770 as Oil extends rally

The offered tone around the USD/CAD pair keeps growing bigger as we progress towards the mi-European session, with the CAD bulls cheering the extended rally in the oil prices.

USD/CAD trades below all major DMAs

Currently, the USD/CAD pair trades -0.32% lower near fresh weekly lows of 1.2770, having failed to hold above 1.28 barrier. The USD/CAD pair resumes its ongoing bearish momentum, reversing a temporary reversal seen yesterday, as the Loonie remains underpinned by rallying oil prices. Both crude benchmarks extend the 4-day winning streak and rally +1.20% each, as hopes for a Bremain lifts the sentiment around risky assets.

The sell-off in the USD/CAD pair can be partially attributed to the ongoing weakness in the US dollar, as Yellen’s remarks continue to weigh. Looking ahead, markets now await the Canadian retail sales data and Yellen’s testimony for further momentum ahead of tomorrow’s EU referendum.

USD/CAD Technical Levels

To the upside, the next resistances are seen near 1.2798/1.2800 (daily pivot/ round number) and 1.2850 (10-DMA). To the downside, immediate support might be located at 1.2747 (Jun 13 Low) and below that at 1.2707 (daily S3).