ING Research sees a scope for a limited correction lower in USD/CAD towards 1.2715/50 in the near-term.

"USD/CAD can continue this correction to 1.2715/50, while USD/NOK could correct a little further to the 9.60 area. However, pockets of recovery in oversold commodity currencies should not be confused for a major turnaround in the dollar," ING notes.

"Our debt strategy team still calls for some further bearish steepening of the US yield curve and the US 10-year real yield pushing to +100bp over coming months - from +20bp today. This will continue to pose a challenge for equity and credit markets and we would view this week's recovery in both as a pause in a bear trend rather than a meaningful reversal," ING adds.