USD/CAD is basically flat on the day trading at 1.3210
Friday’s run higher failed to hold a daily break above the September high @ 1.3226 and that remains the key resistance level that is keeping the pair from breaking higher today. But the failure for buyers to retest the key level is more to do with the fact that the loonie remains underpinned on improved risk sentiment and also the solid rebound in oil prices.
Saudi Arabia’s decision to cut exports by 500k bpd starting next month has given a good lift to oil with Brent trading 2.1% higher and WTI up by 1.5% currently. In turn, that is helping to put a bid in the loonie on the session as it goes toe to toe with the dollar, crushing the rest of the major bloc.
With thin liquidity set to prevail today, the loonie’s performance will very much be tied to the dollar and I would expect the pair to remain trading in a narrow range for the rest of the day.