Ella 
USD/CAD was volatile in Asian markets on Wednesday. Spot prices are currently trading near below 1.3650, still close to the highest level since March 28 hit on Tuesday.
Oil prices are near their annual peak and appear to be supporting the commodity currency Canadian dollar. On the other hand, the dollar has fallen into consolidation after a recent strong rally to a nearly six-month high, still supported by the strengthening view that the Federal Reserve will maintain interest rate increases in the longer term. The above-mentioned push factors failed to provide any meaningful push to USD/CAD, and investors are now looking forward to the Bank of Canada’s interest rate decision to bring new push.
From a technical perspective, the continued rise overnight above the 1.3600 mark is seen as a new trigger for bullish traders. However, USD/CAD has difficulty rising above the 1.3645-1.3650 level barrier. Coupled with the fact that the daily RSI is about to break out into overbought territory, caution should be exercised before betting on further gains ahead of key central bank event risks this week.
Meanwhile, any corrective decline now appears to find support around the 1.3600 round-figure mark, below which the pair could fall to the next relevant support level, close to the 1.3525 area. Some follow-on selling could drag spot prices further below the 1.3500 psychological mark and test the all-important 200-day SMA, which is currently only around the 1.3460 area. The latter should act as a pivot point and a break above it would favor bearish traders.
On the other hand, the overnight swing high of 1.3665-1.3670 may act as short-term resistance, and a break above this level should allow USD/CAD to regain the 1.3700 mark. Positive momentum could extend further into the 1.3730 resistance area and the 1.3800 round figure, and possibly the yearly peak reached in March in the 1.3860 area.
