USD/CAD falls to 9-month lows as oil extends gains

USD/CAD has continued to trend lower during the New York session to hit fresh year-to-date lows, as the loonie tracks oil prices higher.

USD/CAD briefly dropped below the 1.28 mark and scored its lowest level in nine months at 1.2786 before finding support. At time of writing, the pair was trading at 1.2802, down 0.74% on Tuesday and on track to post its third daily decline in a row.

Most of the move has been driven by CAD strength as it remains underpinned by elevated oil prices, with WTI trading 3% higher near $42.00 a barrel amid news Saudi Arabia and Russia have reached a consensus to freeze oil production.

USD/CAD levels to watch

As for technical levels, next supports are seen at 1.2722 (Jul 15 low) and 1.2700 (psychological level). On the other hand, resistances line up at 1.3013/15 (10-day SMA/Apr 11 high) and 1.3065 (20-day SMA).