- USD / CAD is moving lower for the fourth day in a row on Wednesday.
- Risk appetite sentiment hits the safe haven USD and puts pressure on the pair.
- A softer tone around oil prices helps limit deeper losses for the pair.
The pair USD / CAD has broken its consolidation range at the start of the European session on Wednesday and has fallen to nearly three-week lows, around the 1.2680 region. At time of writing, the pair is recovering slightly from lows, still negative on the day just below the 1.2700 level.
The pair has extended last week’s losses and has witnessed some continuation sales for the fourth day in a row on Wednesday. The optimistic sentiment prevailing in the market has affected the relative safe-haven status of the US dollar., which in turn has been considered a key factor putting pressure on the USD / CAD pair.
Global risk sentiment has been supported by the optimism about progress on coronavirus vaccines. This, along with the likelihood of a massive US fiscal spending plan, has fueled the hopes for a strong global economic recovery and it has continued to boost investor confidence.
Even a modest rally in U.S. Treasury yields has done little to provide a respite for the USD. It is worth reporting that developments to accelerate The $ 1.9 Trillion COVID-19 Relief Package by President Joe Biden pushed US Treasury yields to nearly a year high earlier this month.
Having said that, a softer tone around oil prices, down around 0.25% on the day, has limited strong gains for the loonie, currency linked to the prices of raw materials. This has been seen as the only factor that has offered some support to the USD / CAD pair and has helped limit the deeper losses, at least for the moment.
The economic calendar of the United States on Wednesday, which highlights the publication of the latest consumer inflation figures, could generate a new boost to the pair. Apart from this, the broader market risk sentiment will influence the USD price dynamics and could lead to some significant short-term trading opportunities.
USD / CAD technical levels
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