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  • US Dollar Index struggles to extend gains above 96.50.
  • WTI trades in a  tight range below $68.

The USD/CAD pair opened the day with a 20-pip bullish gap and struggled to determine its next short-term direction amid a lack of macroeconomic data releases from the United States and Canada. As of writing, the pair was virtually unchanged on the day at 1.3140.

Following last week’s EM meltdown, investors remain  focused on the market sentiment on Monday. Another sharp rise in the USD/TRY pair during the early trading hours of the Asian session helped the greenback continue  to outperform its rivals. After advancing to its highest level of the year at 96.52, the US Dollar Index erased the majority of its daily gains and was last seen moving sideways in the 96.20-30 band.

In the meantime, the barrel of WTI, which lost nearly $1 last week, is having a tough time recovering its losses. As of writing, the barrel of WTI was trading at $67.15, down 0.9% on the day. Falling crude oil prices are likely to cap the commodity-sensitive loonie’s gains.

There won’t be any macroeconomic data releases in the remainder of the day. The most significant data release from Canada this week will be Friday’s CPI numbers. Tomorrow’s economic docket in the U.S. will feature  import/export price indexes and the NFIB Economic Optimism Index.

Technical outlook

With a daily close above 1.3150 (50-DMA), the pair could extend its upside toward 1.3200 (psychological level) and 1.3285 (Jul. 19 high). On the downside, supports are located at 1.3065 (20-DMA), 1.3015 (100-DMA) and 1.2960 (Aug. 7 low).