• The USD keeps trimming losses against a weaker CAD.
• The Bank of Canada kept rates on hold for the fourth consecutive time
• Lower Oil prices are increasing negative pressure on the loonie.

The US Dollar keeps trimming recent losses with the Canadian Dollar weighed by the low oil prices and the decision of the Bank of Canada to keep rates on hold for the fourth consecutive time.

US employment data on focus

Investors are now looking to the US Jobless claims, which are expected to have increased to 222.000 last week from 218,000 in the previous one, confirming that the US labour market is losing strength.

The impact on the US Dollar, however, is expected to be limited, with traders likely to remain on the sidelines, awaiting Friday’s Nonfarm Payrolls report for more info about the Federal Reserve’s monetary policy plans.

In Canada, the BoC reaffirmed its commitment to hike rates further if necessary although it toned down its hawkish message observing that the slowdown in the economy is cooling inflationary pressures. This has been seen as a sign that interest rates may have peaked.

The immediate bias remains positive with bulls likely to meet an important resistance at 1.3620 ahead of 1.3660. Supports are 1.3550 and the mentioned low at 1.3480.

Technical levels to watch