USD/CAD extends the drop, approaches 1.3100

The Canadian dollar remains on a firm fashion vs. its American peer on Monday, dragging USD/CAD to the vicinity of the 1.3100 handle, fresh session lows.

USD/CAD lower on WTI gains

CAD is deriving extra support from the rally in crude oil prices, with the barrel of West Texas Intermediate hovering over fresh 17-month tops above the $54.00 mark following the recent agreement between non-OPEC producers no cut the oil output by nearly 560K bpd.

In addition, the buck is trading almost unchanged so far today amidst rising cautiousness in light of the upcoming FOMC meeting and the likeliness of a 25bp rate hike on Wednesday.

In addition, and as shown by the latest CFTC report, CAD speculative net shorts remained in the area of multi-week lows, while Open Interest dropped to the lowest level since mid-October on the week to December 6.

USD/CAD significant levels

As of writing the pair is losing 0.52% at 1.3117 facing the next support at 1.3063 (200-day sma) ahead of 1.3002 (low Oct.19) and finally 1.2996 (low Sep.29). On the other hand, a break above 1.3193 (100-day sma) would open the door to 1.3311 (38.2% Fibo of the 2016 drop) and then 1.3357 (high Dec.5).