USD/CAD drops to fresh 2016 lows, 1.27 eyed?

The Canadian dollar continues to gather pace today, now relegating USD/CAD to print fresh YTD lows near 1.2720.

USD/CAD lower on oil, USD

Further recovery in crude oil prices is now sending the barrel of West Texas Intermediate to challenge the $42.00 mark, or session highs, and in turn propping up CAD’s upside.

In addition, the greenback remains on the defensive side for the time being, all amidst increasing risk-on sentiment and ahead of US Housing Starts, Building Permits and the weekly report on crude oil stockpiles gauged by API.

USD/CAD significant levels 

As of writing the pair is losing 0.46% at 1.2727 and a breakdown of 1.2700 (psychological level) would aim for 1.2652 (low Jul.10 2015) and finally 1.2124 (monthly low Jun.24 2015). On the other hand, the next hurdle lines up at 1.2993 (20-day sma) followed by 1.3219 (high Apr.5) and then 1.3298 (high Mar.24).