USD/CAD slides to 1-week lows, further below 1.3300 mark

• USD/CAD remains under some selling pressure for the second straight session.
• The corrective slide seemed unaffected by the bullish sentiment around USD.
• Rebounding oil prices underpinned the loonie and exerted some pressure.

The USD/CAD pair weakened further below the 1.3300 round-figure mark and dropped to one-week lows during the early European session.

The pair extended this week's retracement slide from four-month tops and remained under some selling pressure for the second consecutive session, unaffected by the prevalent bullish sentiment surrounding the US dollar.

USD/CAD weighed down by recovering oil prices

The greenback stood tall near multi-month tops, above mid-98.00s, and got an additional boost from the risk-on mood-led goodish intraday pickup in the US Treasury bond yields, albeit did little to impress bullish traders.

A strong bounce in crude oil prices, now up over 1.5% for the day, underpinned demand for the commodity-linked currency – the loonie and turned out to be one of the key factors prompting some follow-through long-unwinding.

Oil prices recovered further from 13-month lows set earlier this week and remained well supported by improving global risk sentiment. However, concerns over the economic impact from the outbreak of coronavirus might cap gains.

Hence, it will be prudent to wait for some strong follow-through buying before confirming that the pair might have topped out in the near-term and positioning for any further near-term depreciating move amid absent market-moving economic releases.

Technical levels to watch