USD/CAD holding on above 1.2300, data on sight

• Decent support emerged around 1.2300.
• Investors focused on NAFTA talks.
• Canadian CPI next of relevance (Friday).

After testing the area around 1.2300 the figure in early trade, USD/CAD appears to have found some support and is now navigating the 1.2310/20 band, albeit well into the red territory.

USD/CAD attention to NAFTA, data

The pair is down for the fourth consecutive session so far on Thursday, always following the sharp decline in the US Dollar. It is worth recalling that the buck’s sell-off has been accelerated this week in response to comments by US Treasury Secretary S.Mnuchin.

Furthermore, spot remains cautious on the ongoing NAFTA negotiations, while US Commerce Secretary W.Ross accused Canadian PM J.Trudeau to increase the pressure on the US.

In the data space, US initial claims and December’s trade balance figures and new home sales are next on tap. In Canada, retail sales are due later ahead of the more relevant inflation figures for the month of December expected on Friday.

USD/CAD significant levels

As of writing the index is up 0.23% at 1.2314 facing the next support at 1.2293 (low Jan.25) seconded by 1.2119 (low Sep.15 2017) and finally 1.2059 (2017 low Sep.8). On the other hand, a breakout of 1.2419 (10-day sma) would aim for 1.2466 (21-day sma) and then 1.2469 (23.6% of 2017 drop).