USD/CAD eases from tops, remains capped below 1.29 mark

   •  USD sticks to gains near YTD tops but fails to provide any fresh push.
   •  The ongoing bullish move in oil prices underpin Loonie and cap gains.

The USD/CAD pair trimmed some its early strong gains and quickly retreated over 20-25 pips from session tops touched in the past hour.

The pair once again found some decent support near 50-day SMA and was being supported by the ongoing upsurge in the US Dollar, albeit a sudden drop in the US Treasury bond yields now seems to have interrupted the strong bullish momentum to fresh YTD tops.

Adding to this, the ongoing strong bullish momentum in crude oil prices underpinned demand for the commodity-linked currency - Loonie and further collaborated to the pair's retracement slide from the 1.2900 neighborhood. 

Despite the pull-back, the pair remains within a broader trading range, held over the past two weeks or so, and hence, it would be prudent to wait for a decisive break in either direction before positioning for the pair's near-term trajectory.

There isn't any major market-moving economic data due for release and hence, speeches by influential FOMC member would be looked upon in order to grab some short-term trading opportunities.

Technical levels to watch

Any subsequent retracement might continue to find support near the 1.2835 region (50-day SMA), which if broken is likely to accelerate the fall towards the 1.2800 handle. On the flip side, the 1.2890-1.2900 region remains an immediate strong hurdle, which if cleared could lift the pair further towards the 1.2940-45 supply zone.