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  • Gains some follow-through traction for the second straight session on Monday.
  • Some follow-through buying has the potential to lift the pair towards mid-1.3300s.

The USD/CAD pair gained some follow-through traction on Monday and built on the previous session’s late rebound from the vicinity of mid-1.3200s.

The uptick lifted the pair back above the 1.3300 handle, closer to multi-week tops and a resistance marked by 5-1/2-month-old descending trend-line.

Given that the pair on Friday showed some resilience below the very important 200-day SMA, the set-up seems tilted firmly in favour of bullish trades.

Moreover, technical indicators on the daily chart maintained their bullish bias, which further reinforces the near-term constructive outlook for the major.

Hence, a sustained move beyond the mentioned trend-line resistance will set the stage for a move towards October swing highs near mid-1.3300s.

On the flip side, any meaningful pullback might continue to attract some dip-buying near 200-DMA, which if broken decisively might negate the positive outlook.

Sustained weakness below the mentioned support now seems to accelerate the slide towards the 1.3200 handle before the pair eventually drops to the 1.3160-50 region.

USD/CAD daily chart