USD/CAD flirting with weekly lows, around 50-DMA support ahead of ADP

The USD/CAD pair faded an early European session spike to 1.2485 area and touched fresh weekly lows, near mid-1.2400s in the past hour.

The pair extended previous session's retracement slide from over one-month tops and slipped farther below the key 1.25 psychological mark amid a softer tone around the US Dollar, which remained on the back-foot amid speculations over the next Federal Reserve Chairman. 

The pair latest leg of fall, over the past hour or so, could also be attributed to a modest recovery in oil prices. In fact, WTI crude oil pared some of its early losses to the $50.00 neighborhood, which was seen benefitting the commodity-linked currency - Loonie and eventually weighing on the major. 

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It, however, remains to be seen if growing market conviction that the Fed would deliver a third rate hike in December, and renewed optimism over the US tax reform, could lend any immediate support to the greenback and limit deeper losses. 

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Next in focus would be the release of ADP report, followed by the US ISM non-manufacturing PMI and the weekly EIA US crude oil inventories data. Later during the day, the Fed Chair Janet Yellen's scheduled speech would also be looked upon for some fresh impetus.

Technical levels to watch

A follow through weakness below 1.2450 level is likely to accelerate the slide towards 1.2425 intermediate support ahead of the 1.2400 handle. On the flip side, 1.2480 level, closely followed by the 1.25 handle now seems to act as immediate resistance levels, above which the pair is likely to dart towards 1.2535-40 hurdle (yesterday's swing high).