FXstreet.com (Barcelona) - The USD/CAD recovery attempt from 1.0470, 3-weeks low has been capped at 1.0495 high on Asian session, and the pair has pair has dropped back to test 1.0470 support on European session.

The Dollar extended its decline from Dec 17 high at 1.0745 with a100-pip drop on Wednesday, breaking support at1.0550 and falling till a 1.0495 3-week low, as increased oil prices favoured Canadian Dollar to the detriment of its cross-border partner.

UFX Bank explains, following the rise in price of oil, the nation's biggest export, the Canadian Dollar rose to the highest level in almost three weeks, despite that fact that GDP came out worse than expected at 0.2% vs. 0.3% forecast.

For next sessions, Tomas Cedavicious, technical analyst at Investija, expects further bearishness on the pair while below 1.0550: While candles remain below the support level at 1.0550, bears are in control.