The USD/CAD pair lacked any firm directional bias and seesawed between tepid gains/minor losses, below the 1.2800 mark through the early European session. A combination of diverging forces failed to provide any meaningful impetus to the major, instead led to a subdued/range-bound price action on Wednesday. The prevalent bullish sentiment around crude oil prices continued benefitting the commodity-linked loonie, which, in turn, kept a lid on any meaningful upside for the USD/CAD pair.
In fact, oil prices added to the previous day's strong gains of almost 5% and climbed to the highest level in more than a year. Renewed optimism over a massive US fiscal stimulus, along with positive news about the development of COVID-19 vaccines lifted hopes for fuel demand recovery and pushed oil prices beyond the $55.00 psychological mark.