USD/CAD slides further below 1.3000 handle, drops to 50-DMA

Recovery in crude oil prices continues to boost the Canadian Dollar, with the USD/CAD pair extending its reversal from Wednesday's high level of 1.3056 to currently trade around mid-point of 1.2900-1.3000 handle. 

On Wednesday, the pair surged to 1.3050 level following the release of disappointing Canadian trade deficit data for the month of May. The pair gained further traction after US ISM non-manufacturing PMI delivered a positive surprise by printing higher-than-expected reading for the month of June.

The pair, however, lost upside momentum as dovish minutes from FOMC meeting on June 14-15 further diminished prospects of an imminent Fed rate-hike in 2016. However, Friday's NFP data could lead to a sudden turnaround in sentiment as an exceptionally strong data would resurface expectation of an eventual rate-hike, sooner rather than later. 

Meanwhile, short-term traders will take cues from today's economic data that includes - ADP report and weekly unemployment claims data from the US accompanied with the Canadian release of building permits and Ivey PMI, later during NA trading session.

Technical levels to watch

Sustained weakness below 50-day SMA immediate support near 1.2940 region is likely to drag the pair below 1.2900 handle, towards 1.2850-40 support ahead of a short-term ascending trend-line support near 1.2800 region. On the flip side, 100-day SMA region, around 1.3000-1.3030 area remains key resistance level, which if conquered decisively would confirm a near-term bullish break-out that could assist the pair to continue with its upward trajectory immediately towards 1.3145-50 resistance.