USD/CAD is recovering from daily lows of 1.2722, although trades below 1.2750, with the rebound fading amid persisting risk-on market profile.

In the last hour, the upbeat market mood cooled off a bit after Kremlin came out with a statement, citing that there are no concrete plans yet of a Putin-Biden meeting.

The proposed diplomatic talks between the US and the Russian leaders this week were the main reason behind the sudden lift to the market sentiment, earlier on.

With the White House officials confirming the meeting, however, investors still remain hopeful of de-escalation through the diplomacy of the Ukraine crisis, keeping the risk sentiment fairly stable and the greenback still undermined. The renewed uptick in WTI prices also caps the rebound in the USD/CAD pair.

With Friday’s upbeat performance, the quote not only bounced off an upward sloping trend line from January 26 but also portrayed a bull cross on the daily chart. That said, the 21-DMA pierces the 50-DMA from below, which in turn suggests the pair’s further upside.

Also adding to the bullish bias is the firmer RSI line, recently around 55.00.

That said, the 61.8% Fibonacci retracement (Fibo.) of December 2021 to January 2022 downside, near 1.2770, restricts the immediate upside of the USD/CAD prices.

However, major attention is given to a downward sloping resistance line from January 06, around 1.2780 at the latest.

Should the pair rise past-1.2780, the January 2021 peak of 1.2813 will lure the USD/CAD bulls.

On the contrary, pullback moves remain elusive beyond 1.2700 as the 21-DMA, the 50-DMA and the 50% Fibo. offer strong support around the stated level.

Even if the USD/CAD bears manage to conquer the 1.2700 mark, a one-month-long support line near 1.2690, will be important to watch before eyeing further downside.

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