USD/CAD consolidates recent slide to nearly two-month lows

The USD/CAD pair's attempted tepid recovery bounce got sold into and the pair is now headed back towards the lower end of daily trading range.

Currently trading around 1.3125-30 region, the pair maintained its bearish bias for the fifth straight session as a fresh leg of up-move in oil prices renewed buying interest around the commodity-linked currency - Loonie. In fact, WTI crude oil has managed to reverse early losses to currently trading with strength of around 0.4%, back above $53.0/barrel mark, and attracted fresh selling pressure around the major.

The downslide, however, has been limited just above nearly two month low, in the vicinity of 1.3100 handle, touched on Monday in the aftermath of the weekend deal between OPEC and non-OPEC producers to cut their cumulative oil production. 

In absence of any major market moving releases, either from Canada or from the US, investors might take a pause ahead of the much anticipated two-day FOMC meeting starting today, leading to a bearish consolidation or possibly a short-covering bounce. In the meantime, broader sentiment surrounding oil market would remain a key driver for the pair's move on Tuesday.

Technical levels to watch

From current levels, 1.3100 handle might continue to act as immediate support below which the pair is seems to accelerate the slide towards the very important 200-day SMA support near 1.3075 region. On the upside, momentum above session peak resistance near 1.3140 level could get extended beyond yesterday's high resistance near 1.3160-65 region, back towards 100-day SMA hurdle near 1.3195-1.3200 region.