USD/CAD drops to two-week lows near 1.3220 as oil recovery continues
- WTI looks to snap five-day losing streak, trades above $54.
- US Dollar Index stays calm below 98 handle on Tuesday.
- Coming up: CB Consumer Confidence report and Housing Price Index from US.
The USD/CAD pair closed in the negative territory on Monday and is now pushing lower as the commodity-related Loonie gathers strength amid rising crude oil prices. The pair, which touched its lowest level in two-weeks at 1.3224 in the last hour, is now trading at 1.3229, losing 0.18% on a daily basis.
Crude oil capitalizes on recovering sentiment
Speaking at a press conference on Monday, US President Donald Trump said that he was confident that China was sincere about their willingness to make a trade deal with the US. Trump further noted that they were likely to make a trade deal with the EU without needing to impose tariffs on European car imports to further improve the market sentiment. Rising hopes of the trade conflict coming to an end eased concerns over a dismal energy demand outlook and provided a boost to crude oil prices.
At the moment, the barrel of West Texas Intermediate is up 0.9% on the day at $54.25. Later in the day, the weekly crude oil stock report published by the American Petroleum Institue (API) will be looked upon for fresh impetus.
On the other hand, the US Dollar Index (DXY) is moving sideways below the 98 handle on Tuesday ahead of the macroeconomic data releases from the US and makes it difficult for the pair to stage a recovery. The Conference Board will publish its Consumer Confidence report later in the day and the Federal Housing Finance Agency will release the Housing Price Index data. As of writing, the DXY is down 0.15% on the day at 97.90.
Technical levels to watch for