USD/CAD hits fresh weekly lows as CAD tracks oil gains

USD/CAD fell sharply to fresh weekly lows dragged down but a stronger Canadian dollar, which benefited by an unexpected drop in US oil inventories.

According to the Energy Information Administration, US crude oil inventories fell by -3.41 million barrels in the week ended May 6, against expectations of a 0.714 million barrels build, while output fell 0.261% to 8.802 million.

After the news, oil soared and the loonie moved along, sending USD/CAD to a low of 1.2843, last seen on Friday. At time of writing, the pair is trading at 1.2845, recording a 0.49% loss on the day.

USD/CAD technical levels

In terms of technical levels, next supports could be found at 1.2785 (May 5 low) and 1.2737 (20-day SMA) ahead of 1.2696 (May 4 low). On the flip side, resistances are seen at 1.2940 (May 11 high), 1.2973 (50-day SMA) and 1.3015 (May 9 high).