USD/CAD clings to gains above 1.3200 as oil selloff continues

• WTI erases nearly 2% on Thursday, tests $52.
• US Dollar Index erases majority of this week's gains.
• Real GDP in US in Q4 is seen growing 2.1% annually.

Despite the USD's uninspiring performance on Thursday, the USD/CAD pair continues to trade in the positive territory as the CAD struggles to find demand amid plummeting crude oil prices. As of writing, the pair was up 0.15% on the day at 1.3215.

Concerns over the coronavirus weighing on the global oil demand continue to hurt crude oil prices. The barrel of West Texas Intermediate, which is down nearly 16% since the start of the year, was last seen trading at its lowest level since October 10th at $51.90, erasing 2.15% on the day.

On the other hand, the broad-based USD weakness seems to be keeping the pair's upside capped. Although the data published by the Bureau of Economic Analysis showed that the real GDP in Q4 expanded by 2.1% (first estimate) as expected, the greenback struggled to recover the losses it suffered on Wednesday following FOMC Chairman Powell's dovish remarks. The US Dollar Index is now down 0.23% on the day at 97.84.

Focus shifts to Canada GDP data

On Friday, monthly GDP data from Canada will be the next significant catalyst for the CAD. Previewing the data, "TD looks for a flat print on industry-level GDP for November, in line with the market consensus, for the third consecutive month of <0.1% growth," said TD Securities analysts. "With softer manufacturing shipments and energy production, we look for a muted increase in services to provide the main engine of growth. "

Technical levels to watch for