USD/CAD tumbles to 3-week lows near 1.2730

• CAD appreciates to 3-week tops vs. its neighbour.
• The greenback extends the drop to the 90.50 area.
• US flash U-Mich index, Williams’ speak later in the session.

The Canadian Dollar is picking up extra steam vs. its American peer at the end of the week and is dragging USD/CAD to fresh 3-week lows in the 1.2735/30 band.

USD/CAD weaker ahead of data

The pair gained further downside pressure on Friday following extra unwinding of USD long positions in light of the recent rally that lifted the US Dollar Index (DXY) to the area of fresh 2018 peaks well above 93.00 the figure.

Additionally, the rally in crude oil prices is taking the price of the American benchmark for the sweet light crude oil to tops beyond the critical $71.00 mark, lending extra legs to CAD.

Looking ahead, and amidst a weaker buck, US Export/Import Prices are due along with the flash reading of the U-Mich index and the speech by FOMC’s Williams.

In Canada, critical labour market figures for the month of May are also expected.

USD/CAD significant levels

As of writing the index is losing 0.42% at 1.2742 and a break below 1.2732 (low May 11) would open the door to 1.2722 (38.2% Fibo of the 2017 drop) and then 1.2644 (200-day sma). On the upside, the initial hurdle aligns at 1.2846 (10-day sma) seconded by 1.2927 (50% Fibo of the 2017 drop) and finally 1.2999 (high May 8).