The USD/CAD pair refreshed daily lows during the early European session, with bears still awaiting a sustained weakness below the 1.2700 mark. The pair witnessed some fresh selling on Thursday and erased a major part of the previous day's attempted bounce, which ran out of steam ahead of the 1.2800 neighborhood. The USD/CAD pair has now moved well within the striking distance of multi-year lows set earlier this week and was pressured by a combination of factors.
The bearish pressure surrounding the US dollar remained unabated through the first half of the trading action on Thursday amid progress towards additional US fiscal stimulus. In fact, Republicans and Democrats in the US Congress on Wednesday were reportedly closing in on approving a $908 billion COVID-19 relief package. It will now be interesting to see if the USD/CAD pair is able to find any support at lower levels or a sustained break below the 1.2700 mark sets the stage for an extension of the bearish trajectory.