USD/CAD struggles to hold above 1.3700 as oil rally supports CAD
- USD/CAD remains on track to close the day little changed.
- CAD stays resilient against USD boosted by surging crude oil prices.
- US Dollar Index clings to small gains above 97.50.
The USD/CAD pair advanced to a daily high of 1.3705 during the American trading hours but struggled to preserve its bullish momentum. As of writing, the pair was virtually unchanged on a daily basis at 1.3690.
After spending the European session in the negative territory, the US Dollar Index staged a rebound in the second half of the day and provided a boost to the pair. The data from the US revealed that Pending Home Sales in May rose by 44.3 and Dallas Fed Manufacturing Index recovered to -6.1 in June from -49.2 in May. Supported by the data, the DXY rose above 97.50 and now looks to close the day modestly higher.
WTI capitalizes on risk rally
On the other hand, the latest coronavirus data from the US showed that the new infection rate in Florida and the hospitalization rate in Texas both came in lower than the weekend readings and helped market sentiment improve. The upbeat mood allowed the risk-sensitive crude oil prices to gain traction on Monday.
With the barrel of West Texas Intermediate (WTI) rising more than 4% and trading near $40, the commodity-related CAD is staying resilient against its peers.
On Tuesday, Statistics Canada will release the monthly Gross Domestic Product for April. The US economic docket will feature the Conference Board's Consumer Confidence Index. More importantly, FOMC Chairman Jerome Powell will testify before the US House of Representatives Financial Services Committee about the Fed's coronavirus response.
Technical levels to watch for