USD/CAD extends the drop, 1.2900 on sight

The Canadian dollar keeps the upbeat tone vs. its American peer on Tuesday, now relegating USD/CAD to trade in the vicinity of the critical support at 1.2900.

USD/CAD attention to oil, US data

The demand for CAD remains well underpinned by the continuation of the rally in crude oil prices, with the barrel of West Texas Intermediate retaking the $45.00 mark and beyond.

Still on the CAD side, speculative positioning showed CAD longs have climbed to 5-week tops during the week ended on August 30 while Open Interest has scaled back during the same period, all according to the latest CFTC report.

Adding to the decline, the greenback remains on the defensive during the first half of the week, fading further the post-Payrolls spike.

Ahead in the session, ISM Non-manufacturing will take centre stage in the US docket, while the next salient event in Canada will be the BoC meeting, expected tomorrow.

USD/CAD significant levels

As of writing the pair is losing 0.08% at 1.2919 and a break below 1.2903 (low Sep.5) would expose 1.2828 (low Aug.26) and finally 1.2759 (low Aug.18). On the upside, the initial hurdle lines up at 1.2954 (20-day sma) followed by 1.2994 (base of the 4-month rising channel) and then 1.3149 (high Sep.1).