USD/CAD weakens below 1.23 mark, Canadian retail sales and CPI in focus

The greenback lost some more ground on Friday, with the USD/CAD pair retreating further from near two-week highs touched on Wednesday. 

Lack of any strong follow through US Dollar buying interest, despite the latest hawkish Fed announcement, has failed to assist the pair to build on its post-FOMC recovery move, failing just ahead of the 1.2400 handle. 

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Meanwhile, renewed geopolitical tensions stemming out the Korean peninsula kept the greenback on back-foot through early European session on Friday and has now dragged the pair back below the 1.2300 round figure mark.

Currently trading around 1.2280 level, the pair was also being weighed down by the prevalent bullish sentiment around crude oil prices, which tends to boost demand for the commodity-linked currency - Loonie.

Today's key focus would be on the Canadian macro releases - monthly retail sales data and inflation figures, due later during the NA session. Even a slightest miss would now be looked as encouraging the BoC to pause before next rate hike move and eventually assist the pair to continue with its bounce.

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Technical levels to watch

A follow through selling pressure has the potential to continue dragging the pair towards its next support near the 1.2240-35 region, which if broken would point to a retest of the 1.2200 handle.

On the upside, any up-move beyond the 1.2300 handle now seems to confront fresh supply near 1.2325-30 area, above which the pair is likely to dart towards conquering the 1.2400 handle.