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USD/CAD recovery halted near 1.4540

FXStreet (Edinburgh) - After climbing as high as the vicinity of 1.4540, USD/CAD has lost some upside momentum and is now back around the 1.4485/80 region.

USD/CAD focus on oil

The persistent weakness around crude oil prices continues to weigh on the Canadian dollar, remaining its almost exclusive driver. At the moment the barrel of West Texas Intermediate hovers just above the $28.00 mark, bouncing off yesterday’s fresh 13-year low near $27.50.

The BoC left unchanged its benchmark rate at its meeting on Wednesday against a split consensus. All in all, the central bank showed a neutral tone and revised lower its GDP forecasts while it showed concerns over the gloomy outlook on crude oil.

USD/CAD significant levels

As of writing the pair is losing 0.01% at 1.4486 and a break below 1.4164 (20-day sma) would aim for 1.3793 (low Dec.24) and finally 1.3790 (3-month uptrend). On the other hand, the next resistance is located at 1.4692 (high Jan.20) followed by 1.4946 (high Apr.7 2003) and then 1.5000 (psychological handle).

EUR/GBP drops below 0.77

The offered tone around EUR strengthened, pushing the EUR/GBP pair back below 0.80 as investors expect Draghi to stress the need to do more to combat deflation.
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Oil drops again as inventories likely to climb

After a brief recovery seen during Asia, both crude benchmarks came under renewed selling pressure in the European session as nervousness grew ahead of the weekly EIA inventory report.
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