USD/CAD struggling to extend recovery decisively beyond 1.3150 level

The USD/CAD pair continued with its struggle for a follow through action, albeit has managed to hold in positive territory for the day.

Currently hovering around mid-1.3100s, stalling US Dollar recovery witnessed on Monday failed to assist the pair to build on to its tepid recovery bounce. Meanwhile, a mildly weaker sentiment surrounding oil market, despite of a minor recovery from session low, was seen weighing on the commodity-linked currency - Loonie, and has helped the pair to snap three days of losing streak. 

With the US markets closed in observance of Martin Luther King Day, investors seemed to readjust their positions ahead of this week's important US macro data, BOC monetary policy decision and President-elect Donald Trump's inauguration, which would determine the pair's next leg of directional move.

Technical levels to watch

On a sustained move above 1.3165 immediate resistance, the pair seem all set to head towards reclaiming 1.3200 handle before aiming to test its next resistance near 1.3245-50 region. On the downside, weakness back below 1.3125-20 region is likely to accelerate the slide towards the very important 200-day SMA support near 1.3100-1.3095 region below which the pair would turn vulnerable to drift back towards retesting last week's multi-month lows support near 1.3030 region.