USD/CAD confined in a narrow range above 200-DMA

The USD/CAD pair has been confined within a 20-pips narrow band and is now heading towards the top end of daily trading range. 

Currently trading around 1.3135 region, the pair has held on to its move back above the very important 200-day SMA despite of a broad based US Dollar weakness in wake of the US President Donald Trump's executive order on Friday, imposing a 90-day ban on travelers from seven Islamic countries. 

Meanwhile, weaker sentiment around oil markets, with WTI crude oil dipping back below $53.00/barrel mark and trading with a loss of around 0.5%, has failed to benefit the commodity-linked currency – Lonnie, and assisted the pair to shrug off concerns over Trump’s protectionist stance. Moreover, Quebec mosque terrorist attack during Sunday night prayers also seems to be weighing a bit on the Canadian Dollar and helping the pair to defend 200-day SMA support, at least for the time being.

Traders now look forward to the US economic releases later during NA trading session, which include the Fed’s preferred inflation gauge – Core PCE Price Index, in order to grab some short-term trading opportunities. 

Technical levels to watch

Immediate resistance is pegged near 1.3150 region above which the pair is likely to head towards 1.3190-95 horizontal resistance. A follow through buying interest as the potential to lift the pair towards 1.3220 hurdle ahead of 1.3245-50 strong barrier.

On the flip side, 1.3115 region (200-day SMA) remains immediate support to defend, which if broken is likely to drag the pair towards 1.3090-85 intermediate support, en-route 1.3065 and 1.3040 support levels.