USD/CAD extends strong up-surge further beyond 1.35 mark

The USD/CAD pair continues to gain traction and built on to its momentum further beyond the 1.3500 psychological mark.

Currently trading around 1.3520 region, a fresh wave of sell-off in oil markets has been a key factor supporting the pair's strong up-surge to the highest level since Dec. 29. In fact, at one point WTI crude oil slipped below $49.00/barrel mark to its lowest level since December and was seen weighing heavily on the commodity-linked currency - Loonie.

Meanwhile, a minor recovery in oil prices, coupled with a modest US Dollar retracement, seems to have halted the pair's strong up-move, at least for the time being.

However, with markets bracing for an eventual Fed rate-hike action next week, continuous upsurge in the US treasury bond yields should continue to underpin the greenback and limit any immediate corrective slide for the major ahead of Friday's key NFP report.

Technical levels to watch

Immediate resistance is pegged near 1.3555-60 region, above which the pair seems all set to head towards reclaiming the 1.3600 handle before darting towards its next resistance near 1.3635 level. 

On the downside, the key 1.35 psychological mark now become immediate support to defend, which if broken could extend the corrective slide towards 1.3460-55 intermediate support ahead of 1.3415-10 important horizontal support.