USD/CAD attempts a move back towards 1.22 handle

The USD/CAD pair built on overnight steady recovery move and might now be looking to make a fresh attempt to conquer the 1.2200 handle.

On Wednesday, the pair managed to recover early lost ground to 1.2130 level but failed to sustain at higher levels, despite of a broad based US Dollar strength led by news that a US tax reform plan will be announced shortly.

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A strong rally in crude oil prices underpinned the commodity-linked currency - Loonie and capped further up-move for the major.

With the greenback extending overnight gains, a modest pull-back in oil prices supported the pair's uptick through early European session on Thursday.

On the economic data front, the disappointing release of US PPI was overshadowed by renewed optimism over the US President Donald Trump's pro-growth economic policies. 

Today's economic docket, featuring the release of latest US consumer price inflation data along with Canadian New Housing Price Index (NHPI), would now be looked upon for some fresh impetus later during the NA session. 

Technical levels to watch

Momentum beyond the 1.22 handle might continue to confront some supply near 1.2220-25 area, above which the pair is likely to accelerate the move towards mid-1.2200s before eventually aiming to reclaim the 1.2300 mark.

On the flip side, mid-1.2100s now seems to protect immediate downside, which if broken decisively could drag the pair back below the 1.2100 handle towards testing its next support near 1.2075 level.