USD/CAD consolidates in 30-pips range below 1.3080

• CAD underpinned by NAFTA optimism, higher oil prices.
• US PPI data, trade developments to offer fresh direction on USD/CAD.

The USD/CAD pair extends its Asian consolidative range into Europe, fluctuating between gains and losses below the 1.3080 level, as markets await fresh catalysts for the next move.

USD/CAD: NAFTA talks in focus

The spot traded almost unchanged for the day, keeping its range near weekly lows of 1.3043, as the Canadian dollar continues to remain underpinned by the renewed optimism around the NAFTA talks.

The US President Trump commented late-Tuesday, "Trade talks going well. Canada wants to make a deal". Soon after the Canadian Foreign Minister Freeland noted: “Both sides did a lot of thinking over the weekend, so this was a very productive meeting. Having said all of that,

Moreover, the 2% rise in the US oil also collaborated to the overnight recovery in the resource-linked Loonie. WTI rallied on declining US inventories and looming US sanctions on  Iran that have triggered supply disruption concerns.

Despite the buoyancy seen around the Canadian dollar, the spot manages to contain the downside amid renewed trade tensions, this time between US and Japan, which helped put the bid back under the US dollar across the board.

USD/CAD Technical Levels

FXStreet’s Analyst, Eren Sengezer, noted: “The immediate resistance for the pair aligns at 1.3080 (100-DMA) ahead of 1.3170 (daily high) and 1.3200/05 (psychological level/Sep. 4 high). On the downside, supports could be seen at 1.3000 (psychological level), 1.2960 (Aug. 7 low) and 1.2900 (Aug. 29 low).”