USD/CAD dips below 1.3100, near-term bullish bias remains

After advancing for three consecutive days, the USD/CAD pair is retracing from 6-week high and has now dipped below 1.3100 handle. 

The US Dollar remained on the back foot on Tuesday, which is assisting some tepid recovery in crude oil prices and lifting commodity-linked currency - like loonie. 

On Monday, the greenback continued gaining traction from Friday's surprisingly strong employment details. Meanwhile, drop in crude oil price further fueled to the bullish sentiment surrounding the USD/CAD pair and boosted it to 6-week high level of 1.3140.  
In absence of any major economic releases on Tuesday, the pair would continue to derive its movement from sentiment surrounding crude oil prices.

From technical perspective, the pair extended its bullish break-out momentum above 100-day SMA region and subsequently managed to break through a short-term descending trend-line resistance, suggesting that Tuesday dip could be a pause before the pair resumes its near-term bullish trend.

Technical levels to watch

From current levels, weakness below 1.3070 immediate support seems to drag the pair back towards 100-day SMA strong support near 1.3000 psychological mark. Any weakness below 100-day SMA might be bought into and hence could limit any further downside at 50-day SMA support near 1.2960-55 region. Meanwhile, momentum above 6-week high resistance near 1.3130-40 area would confirm extension of the pair's near-term bullish momentum that could assist the pair beyond May highs resistance near 1.3175 and 1.3200 handle, towards testing late March highs resistance near 1.3280-85 region.