Canadian Dollar Higher On Rising Oil Prices

The Canadian dollar drifted higher against its major counterparts in the European session on Tuesday, as oil prices advanced amid an escalation in tensions in the Middle East and on speculation the OPEC will continue to produce less crude for some more time.

Crude for July delivery rose $0.28 to $63.49 per barrel.

According to reports, Yemen's Iranian-allied Houthi rebels attacked a Saudi airport and military base with a bomb-laden drone, an assault acknowledged by the kingdom as Mideast tensions remain high between Tehran and the United States

Traders await weekly U.S. crude inventories reports from the American Petroleum Institute and Energy Information Administration for more direction. API is scheduled to come out with its report later in the day, while EIA's report is due Wednesday morning.

The currency has been trading in a positive territory against its major rivals in the Asian session, excepting the greenback.

The loonie appreciated to a 2-week high of 82.42 against the yen, from a low of 81.91 hit at 5:00 pm ET. The next key resistance for the loonie is likely seen around the 83.5 level.

Having dropped to 1.5000 against the euro at 5:45 pm ET, the loonie reversed direction and touched a 1-1/2-month high of 1.4944. The loonie is seen finding resistance around the 1.47 level.

Following a low of 1.3434 hit at 3:15 am ET, the loonie bounced back to touch a 5-day high of 1.3403 against the greenback. On the upside, 1.32 is likely seen as the next resistance level for the loonie.

The loonie spiked up to a 7-month high of 0.9216 against the aussie, recovering from a low of 0.9299 seen at 7:30 pm ET. Next key resistance for the loonie is possibly seen around the 0.91 level.

Reserve Bank of Australia Governor Philip Lowe signaled an interest rate cut in June to underpin growth in employment.

Addressing the Economic Society of Australia in Brisbane on Tuesday, Lowe said, "A lower cash rate would support employment growth and bring forward the time when inflation is consistent with the target."

Looking ahead, Eurozone flash consumer sentiment index for May is due at 10:00 am ET.

At the same time, U.S. existing home sales for April are scheduled for release.

Chicago Fed President Charles Evans will speak about the economy and monetary policy at the Financial Markets Conference in Florida at 10:45 am ET.

At 12:00 pm ET, Boston Fed President Eric Rosengren will give a speech at the Economic Club of New York.