USD/CAD struggles near weekly lows, around 1.3035 region

• USD/CAD remains depressed for the second consecutive session on Thursday.
• Oil prices rise on US-China trade deal optimism and underpinned the loonie.
• The USD struggles to find buyers and weighed further ahead of US retail sales.

The USD/CAD pair edged lower for the second consecutive session on Thursday and is currently placed near the lower end of its weekly trading range, around the 1.3035 region.

Oil prices rose on the back of the latest optimism over the long-awaited US-China phase one trade deal, which eventually underpinned demand for the commodity-linked currency – loonie and turned out to be one of the key factors exerting some pressure.

However, the fact that the outcome was nearly priced in the market, the announcement did little to impress the US dollar bulls. Meanwhile, a modest pickup in the US Treasury bond yields extended some support to the USD and helped limit the downside.

Hence, it will be prudent to wait for some strong follow-through selling, possibly below the key 1.30 psychological mark, before positioning for any further near-term appreciating move ahead of Thursday's release of the US monthly retail sales data.

Thursday's economic docket also features the release of Canadian ADP report and Philly Fed Manufacturing Index from the US. This coupled with a scheduled speech by the Fed Governor Michelle Bowman might further produce some short-term trading opportunities.

Technical levels to watch