USD/CAD on the verge of sliding back below 1.3100 handle

The USD/CAD pair maintained its near-term bearish bias and is extending Friday's reversal from 1.3200 neighborhood amid upbeat sentiment surrounding crude oil prices. 

Currently hovering around 1.3100 handle, the pair is being weighed down by Friday's better-than-expected monthly Canadian GDP print and mixed US economic data. 

Moreover, the prevalent risk-on sentiment is helping crude oil prices to build on to last week's strong gains led by a preliminary agreement among major oil producers to cap oil output and is eventually benefitting the commodity-linked currency - loonie. 

The pair, however, has managed to hold its neck above the very important 200-day SMA and hence only a strong follow through selling pressure below this important support would turn the pair vulnerable to continue drifting lower in the near-term.

Today's release of US ISM manufacturing PMI and RBC Manufacturing PMI from Canada might provide the required momentum to break through or stage a rebound from this important support.

Technical levels to watch

On a sustained weakness below 1.3100 handle, the pair is likely to immediately drift towards 200-day SMA support near 1.3065-60 region below which the slide could further get extended towards 100-day SMA support near 1.3010-1.3000 region.

Meanwhile on the upside, any recovery attempts now seem to confront resistance near 1.3140 level, which if cleared is likely to boost the pair immediately towards 1.3200 handle.