USD/CAD recovers further from multi-week lows, US/Canadian data in focus

• USD/CAD gains some follow-through traction on Friday.
• Investors seemed inclined to lighten their bearish bets.
• The focus shifts to important US/Canadian macro data.

The USD/CAD pair edged higher for the second consecutive session on Friday and recovered further from multi-week lows set earlier this week.

The pair added to the previous session's modest uptick and gained some follow-through traction on the last trading day of the week. The uptick lacked any obvious fundamental catalyst and might still be categorized as a short-covering bounce.

A mildly positive tone surrounding the US dollar, supported by a modest uptick in the US Treasury bond yields, seemed to be the only factor prompting traders to unwind their short positions ahead of important US/Canadian macro releases.

The US economic docket highlights the release of the final Q3 GDP growth figures. This will be followed by the release of personal income/spending data and Core PCE price index, which might provide a fresh impetus to the major.

Adding to this, Canadian monthly retail sales data will also move the Canadian dollar and further contribute towards producing towards some meaningful trading opportunities later during the early North-American session.

Meanwhile, a consolidative trading action around crude oil prices did little to influence demand for the commodity-linked currency – loonie or hinder the pair's attempted recovery move, though lacked any strong bullish conviction.

Technical levels to watch