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  • US Dollar Index tests the 96 handle.
  • The barrel of West Texas Intermediate loses more than 1% on the day.
  • Canada and the U.S. markets will be closed on Monday.

After staying quiet near mid-1.29s during the Asian trading hours, the USD/CAD paired gained traction and rose above the 1.30 mark during the European morning. The pair, which touched a 10-day high at 1.3010 earlier in the day, was last seen trading at 1.2994, adding 0.42% on a daily basis.

The pair’s upsurge on Monday seems to be the product of a stronger greenback. With European currencies coming under a heavy selling pressure on Monday, the strong demand for the greenback helped the US Dollar Index rise above the 96 mark. Although the trading action in the NA session is expected to stay subdued as Canadian and American traders will be enjoying their holidays, the US Dollar Index looks to end the day in the positive territory. At the moment, the DXY is up 0.32% at 95.98.

On the other hand, the commodity-sensitive loonie is struggling to stage a recovery with crude oil staying under bearish pressure on Monday. After recording sharp losses in the second half of last week, the barrel of West Texas Intermediate continued to push lower on Monday and broke below $74. As of writing, the barrel of WTI was losing 1.1% on the day at $73.50.

Technical outlook

With today’s rise, the pair remains on track to close the sixth straight day in the positive territory, and the RSI on the daily chart advances above the 50 mark to suggest that buyers are taking control of the price action. With a daily close above 1.3000 (psychological level), the pair could target 1.3075 (100-DMA) and 1.3165 (Aug. 17 high). On the downside, supports are located at 1.2960 (200-DMA), 1.2890 (Oct. 5 low) and 1.2835 (Sep. 30 low).