USD/CAD flirting with 1.2600 ahead of Fedspeak, BoC

• Spot is in 6-week tops near 1.2600.
• USD extends the upside.
• Fedspeak, BoC in the limelight.

The upside momentum around the US Dollar is now pushing USD/CAD to test the area of multi-week peaks in the boundaries of 1.2600 the figure.

USD/CAD attention to Fedspeak, BoC

Spot is trading at shouting distance from the key up barrier at 1.2600 the figure today following a continuation of the buying interest surrounding the greenback.

US-CA yield spread differentials continue to be the main driver behind the pair’s price action, with yields of the key US 10-year benchmark now hovering over the 2.84% limestone, or daily tops.

Additionally, prices of the barrel of the West Texas Intermediate are down around 1% below the $62.00 mark so far today, adding to the selling pressure around CAD.

In the data space, BoC’s SeniorDeputy Governor C.Wilkins will speak later in the session along with Dallas Fed R.Kaplan (hawkish), Philadelphia Fed P.Harker (hawkish), Minneapolis Fed N.Kashkari (dovish) and KC Fed E.George (2019 voter, hawkish).

On the data front, US initial claims are due seconded by Canadian housing starts during December.

USD/CAD significant levels

As of writing the index is gaining 0.15% at 1.2584 facing the immediate up barrier at 1.2613 (100-day sma) seconded by 1.2626 (200-week sma) and then 1.2722 (38.2% Fibo of the 2017 drop). On the other hand, a breach of 1.2491 (low Feb.6) would pave the way for a test of 1.2469 (23.6% Fibo of the 217 drop) and finally 1.2427 (21-day sma).