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USD/CAD firmer, 1.38 around the corner

FXStreet (Edinburgh) - The Canadian dollar keeps depreciating vs. the greenback on Monday, now lifting USD/CAD to test fresh cycle tops in the 1.3780 area.

USD/CAD stronger on oil collapse

Crude oil prices are deteriorating further today, dragging the barrel of West Texas Intermediate below the $35.00 mark for the first time since 2009, taking a toll on CAD and sending spot to the boundaries of 1.3800 the figure.

Absent releases in US and Canada today, the next risk events will be tomorrow’s speech by Governor S.Poloz and US inflation figures tracked by the CPI.

USD/CAD levels to consider

As of writing, the pair is up 0.10% at 1.3756 and a break above 1.4000 (monthly high May 2004) would expose 1.4195 (monthly high Jul.2003). On the flip side, the next support lines up at 1.3401 (2-month uptrend) ahead of 1.3246 (55-day sma) and then 1.3222 (100-day sma).

Stay short AUDUSD into the Fed with target of 0.7000 - BNPP

Research Team at BNP Paribas, suggests that their top G10 FX trade heading into the meeting is short AUDUSD (target 0.7000), which they expect to benefit both from broad USD strength and from periods of market stress which can hurt the USD vs. lower yielding currencies.
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CFTC positioning: USD longs push higher ahead of Fed - Rabobank

Jane Foley, FX Strategist at Rabobank, suggests that according to the IMM Net Speculators’ Positioning data as at 08 December 2015, the USD longs continued to push higher on anticipation of a tightening in policy from the Fed on December 16.
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