USD/CAD consolidates losses around 1.2300 ahead of mid-tier data
- USD/CAD closed previous two days in the negative territory.
- US Dollar Index fluctuates in a tight range below 92.00.
- Focus shift to mid-tier data releases from US and Canada.
Following Monday's deep correction, the USD/CAD pair extended its slide on Tuesday amid broad-based USD weakness. In the absence of significant fundamental drivers, the pair seems to have gone into a consolidation phase near 1.2300, where it closed the previous day.
DXY turns quiet below 92.00 ahead of PMI data
While testifying before the House Select Subcommittee on the Coronavirus Crisis on Tuesday, FOMC Chairman Jerome Powell refrained from delivering any surprising remarks on the policy outlook and the greenback struggled to find demand. The US Dollar Index (DXY) finished the second straight day with losses and allowed the bearish momentum on USD/CAD to remain intact.
Ahead of the IHS Markit's preliminary June Manufacturing and Services PMI report, the DXY is clinging to small recovery gains above 91.70. New Home Sales for May will be featured in the US economic docket as well. On the other hand, Statistics Canada will release April Retail Sales data.
Meanwhile, the barrel of West Texas Intermediate (WTI) is up modestly on the day at $73.35, helping the commodity-related loonie stay resilient against its rivals. Later in the session, the US Energy Information Administration's (EIA) weekly Crude Oil Stocks Change data will be looked upon for fresh impetus.
Technical levels to watch for