USD/CAD consolidates overnight strong gains, NFP awiated

   •  Struggles to build on overnight strong gains despite mildly positive USD.
   •  Weaker oil prices/trade war fears also do little to provide an impetus.
   •  Focus remains on today’s key release of the US monthly jobs report.

The USD/CAD pair struggled to build on the overnight upsurge and traded with a mild negative bias, within a narrow trading range, through the early European session on Friday.

On Thursday, the pair found decent support near 50-day SMA, around the 1.2820-15 region, and rallied hard after Canadian GDP report showed that economy grew at its slowest pace in nearly two years in the first quarter, which now seems to have reduced odds of a BoC rate hike move next month. 

This coupled with the Trump administration's decision to slap tariffs on Canada and Mexico, making it less likely for a new NAFTA deal in the near-term, prompted some aggressive selling around the Canadian Dollar. 

The pair surged around 170-pips from intraday lows but failed ahead of the key 1.30 psychological mark despite a goodish pickup in the US Dollar demand, supported by mostly positive US economic data. 

Resurgent US Treasury bond yields helped the greenback to hold on to its mildly positive tone on the last trading day of the week, albeit did little to provide any fresh bullish impetus to the major. 

Moreover, a consolidative action around crude oil prices failed to influence demand for the commodity-linked currency - Loonie and further collaborated to the pair's range-bounce/subdued price action. 

Investors now seemed to have moved on the sidelines and preferred to wait for the release of keenly watched US NFP report before positioning for the pair's next leg of directional move.

Technical levels to watch

Any meaningful retracement is likely to find immediate support near the 1.2900 handle, which if broken might turn the pair vulnerable to slide back towards challenging 50-day SMA support near the 1.2820-15 region.

On the upside, momentum back above 1.2975 level might continue to confront resistance near the 1.30 handle, above which the pair is likely to head back towards mid-1.3000s supply zone before eventually darting towards the 1.3100 round figure mark.