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USD/CAD extends sideways grind below 1.3300

  • WTI posts small daily losses, trades above $50.
  • Building Permits in Canada is expected to rebound in December.
  • USD stays calm ahead of Fed Governor Bowman's speech.

The USD/CAD pair registered its highest weekly close since late September at 1.3320 and seems to have lost its bullish momentum at the start of the new week. As of writing, the pair was trading at 1.3296, down 0.12% on the day.

Oil struggles to recover

The heavy selling pressure surrounding crude oil last week and the USD's strong performance on the back of upbeat macroeconomic data releases allowed the pair to push higher. 

Worries over the coronavirus outbreak weighing heavily on the global oil demand caused the barrel of West Texas Intermediate (WTI) to post losses for the fifth straight week, hurting the demand for the commodity-sensitive CAD. While investors are waiting for OPEC to announce its decision on deeper output cuts, the WTI is trading in a tight range above the $50 mark.

On the other hand, after gaining nearly 1.4% last week, the US Dollar Index (DXY) is edging lower on Monday to cause the pair to stay in the negative territory. Ahead of  Fed Governor Michelle Bowman's speech, the DXY is down 0.09% on the day at 98.61.

The Canadian economic docket will feature Building Permits, which is expected to rebound to +0.6% in December from -2.4% in November.

Technical levels to watch for

 

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