The Canadian dollar is trading near 1.2850, gaining nearly 80-pip in today’s session. A weaker dollar and risk-on mood infused capital flow into the riskier asset. A lukewarm economic data and a rise in commodity prices lifted Loonie.
The 10-year U.S benchmark treasury yield fell nearly 2.66% to 2.76 which weighs on the prospects of the greenback. The U.S dollar index remains pressured below 106.50 as investors reassessed the U.S Fed monetary policy outlook.
Further, the U.S consumer inflation expectations for the year ahead dropped to 6.2% in July, from the record high of 6.8% in June. Investors doubt this will influence the Fed’s aggressive monetary stance.
Despite the weak economic data, the commodity currency demand is underpinned by the rising commodity prices.
WTI rose more than 1% on Monday and was trading at $91.27 as of writing. Upbeat U.S jobs and Chinese export data uplift the prices despite the demand side concerns.
On the daily chart, the USD/CAD pair trades inside the symmetrical triangle pattern. The price hovers near 1.2850.
The price slips below the 21-day Exponential Moving Average (EMA) at 1.2883. Bears get in charge and are expected to break below the lower trend line of the triangle.
In that case, the pair could test 1.2800 followed by the low of June 9 at 1.2680.
The RSI (14) dipped below 44, indicating the increasing bearish momentum.
On the other hand, a shift in the bullish sentiment could move toward the previous session’s highs of 1.2984.
