The USD/CAD pair struggles to capitalize on the overnight breakout momentum through the very important 200-day Simple Moving Average (SMA) and retreats from a nearly three-week top, around the 1.3615 area touched earlier this Wednesday. Spot prices extend the steady intraday descent through the first half of the European session and drop to the 1.3590-1.3585 region, or a fresh daily low in the last hour.Crude Oil prices rallied around 1.75% and moved away from the lowest level since May 2023 touched on Tuesday amid concerns about supply disruption in the wake of Hurricane Francine in the United States (US). This is seen underpinning the commodity-linked Loonie, which, along with the emergence of fresh US Dollar (USD) selling, turn out to be key factors exerting downward pressure on the USD/CAD pair. That said, hopes for additional interest rate cuts by the Bank of Canada (BoC), bolstered by Friday’s disappointing Canadian jobs data, should keep a lid on any meaningful appreciating move for the Canadian Dollar (CAD). Apart from this, reduced bets for a larger interest rate cut by the Federal Reserve (Fed), along with a softer risk tone, could offer support to the safe-haven buck and limit losses for the USD/CAD pair. Traders also seem reluctant and might prefer to wait for the release of the crucial US Consumer Price Index (CPI) report before placing fresh directional bets. Hence, it will be prudent to wait for strong follow-through selling before confirming that the USD/CAD pair’s recent recovery from the 1.3440 region, or a multi-month low touched in August has run its course and positioning for a further depreciating move.More By This Author:USD/JPY Recovers Few Pips From 142.00 Mark, Looks To US CPI For Fresh Impetus US Dollar Rises Ahead Of Tuesday Presidential Debate EUR/GBP Price Analysis: Bearish Outlook Persists, Pair Continues Sideways Trading
