• USD/CAD retreats from a multi-week top and is weighed down by a combination of factors.
• Rebounding Oil prices underpin the Loonie and exert pressure amid renewed USD selling.
• The downside seems limited as traders keenly await the release of the crucial US CPI report.

The USD/CAD pair struggles to capitalize on the overnight breakout momentum through the very important 200-day Simple Moving Average (SMA) and retreats from a nearly three-week top, around the 1.3615 area touched earlier this Wednesday. Spot prices extend the steady intraday descent through the first half of the European session and drop to the 1.3590-1.3585 region, or a fresh daily low in the last hour.

Crude Oil prices rallied around 1.75% and moved away from the lowest level since May 2023 touched on Tuesday amid concerns about supply disruption in the wake of Hurricane Francine in the United States (US). This is seen underpinning the commodity-linked Loonie, which, along with the emergence of fresh US Dollar (USD) selling, turn out to be key factors exerting downward pressure on the USD/CAD pair.