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  • USD/CAD falls sharply on surging crude oil prices.
  • WTI gains more than 8%, trades above $40.
  • US Dollar Index continues to fluctuate below 93.50.

The USD/CAD pair came under heavy bearish pressure in the last minutes and dropped to its lowest level since early January at 1.2965. As of writing, the pair was down 0.6% on the day at 1.2975.

Oil rallies on coronavirus vaccine hopes

Pharmaceutical giant Pfizer announced on Monday that its experimental COVID-19 vaccine in the latest stage of the trial showed that it prevents 90% of infections with no serious safety concerns. With the initial market reaction, crude oil prices shot higher and helped the commodity-related CAD gather strength against its rivals. As of writing, the barrel of West Texas Intermediate (WTI) was up 8.3% on the day at $40.50. 

Breaking: Pfizer says covid vaccine 90% effective, markets jump, dollar falls.

On the other hand, the US Dollar Index is posting small daily gains at 92.30. However, the risk-on market environment seems to be lifting US stocks futures, suggesting that Wall Street’s main indexes stage a strong rally at the start of the week. If risk flows continue to dominate the markets during the American trading hours, the greenback could find it difficult to stay resilient against its peers. At the moment, the S&P 500 futures are up 3.8% on the day.

Technical levels to watch for