USD/CAD sits slightly higher, last....>

DOLLAR-CANADA: USD/CAD sits slightly higher, last at C$1.3246, after falling 48

pips yesterday as oil prices soared on the back of the abrupt removal of ~5% of

global production due to the weekend drone strike on a major Saudi oil facility.

- The rate gradually moved away from its worst levels yesterday as its initial

oil-linked losses were somewhat countered by broader risk aversion stemming from

heightened geopolitical tensions. Renewed selling pressure was noted as BBG

reported that Aramco are said to be less optimistic about the speed of an output

recovery, with the firm forced to ramp up offshore fields in order to replace

lost output. Subsequent move to the intraday peak, touched around the WMR fix,

was followed by another dip late doors.

- On the technical front, bears set their sights on C$1.3209/06, the 50-DMA/low

of Sep 13. A failure to break under the level would reassure bulls, shifting

their focus to the C$1.3274 100-DMA. Above there would clear the way towards

C$1.3288, the 61.8% fibo retracement of the slide noted this month. This latter

level is all the more significant given that it capped gains last Friday.

- Canadian CPI (Weds) & retail sales (Fri) headline the local docket this week.