USD/CAD reclaims 1.2700 handle

   •  Resurgent USD demand underpinning. 
   •  Subdued oil prices fail to support Loonie.
   •  Focus remains on the US tax cut legislation.

The USD/CAD pair gained some positive traction at the start of a new trading week and might now be looking to build on its up-move back above the 1.2700 handle.

A fresh wave of greenback buying interest, with the key US Dollar Index placed at session tops around mid-94.00s, has been one of the key factors driving the pair higher through the early European session on Monday. 

Adding to this, a lacklustre trading action around oil markets, which tends to drive demand for the commodity-linked currency - Loonie and further collaborated to the pair's modest uptick. 

It would now be interesting to see if the pair is able to build on early up-move or meets with some fresh supply at higher levels amid sliding US Treasury bond yields and uncertainty surrounding the US tax cut legislation.

Given that Canadian banks will remain closed in observance of Remembrance Day, broader market sentiment around the greenback and oil price dynamics would remain key determinants of the pair's movement on Monday amid empty US economic docket. 

Technical levels to watch

Immediate resistance is pegged near 1.2725 level, above which the pair is likely to dart towards 1.2780 horizontal resistance ahead of the 1.2800 handle.

On the flip side, 1.2675-70 zone is likely to protect the immediate downside, which if broken would pave way for extension of the pair's corrective slide towards 1.2620 level en-route 100-day SMA support near the 1.2590 region.