USD/CAD jumps to five-day highs above 1.3600 and loses strength

• Canadian dollar spikes lower across the board despite economic data and higher crude oil prices.
• USD/CAD retreats modestly to 1.3570 as US Dollar pulls back.

The USD/CAD jumped to 1.3603, reaching the highest level since last Thursday and then pulled back to the 1.3570/1.3585 range. The move higher took placed despite better-than-expected Canadian economic data.

The loonie is the worst performer among the commodity block. The Ivey PMIs in Canada showed a strong rebound in June to 58.2, above the 25.1 expected but CAD ignored the numbers. Not event crude oil prices are helping the loonie. The WTI barrel gains 0.50% and is trading near $41.00.

Wall Street indexes are posting mixed results and gold is at fresh multi-year highs near $1800/oz. Despite all, USD/CAD is holding onto daily gains as it trades at 1.3585, up 50 pips for the day, but off highs.

Levels to watch

On the upside, a consolidation above 1.3590 in USD/CAD would clear the way for another test of 1.3600 and beyond. The next resistance is seen at 1.3625 (last week high). On the flip side, 1.3550/55 is the lower limit of the current range and also the 20-SMA in 4-hour chart, so a break lower would expose 1.3515 (weekly low).