TORONTO -(Dow Jones)- The Canadian dollar dropped sharply lower Monday morning, pushing the U.S. dollar to its highest level since September 2004 as options-related trading added to the selling pressure on the currency from general risk aversion. The U.S. dollar reached a high at C$1.3065, according to electronic trading system EBS, its first break above the technically significant C$1.3000 level since Dec. 5. It's now trading around C$1.3045 from C$1.2885 late Friday. Stop-loss orders above C$1.3000 and options-related trading at that level helped propel the rapid U.S. dollar climb, said C.J. Gavsie, managing director, corporate and institutional foreign exchange at BMO Capital Markets in Toronto. "(There's been) very good defense over the past few weeks, but by all means we needed to blast through and see what was above," he said. There are also Canadian corporate orders to sell the U.S. dollar against its Canadian counterpart which are helping cap the greenback's climb at the moment, Gavsie said. The U.S. dollar will likely run into technical resistance around C$1.3080, and then another round of options activity at C$1.3100, he said. -Don Curren, Dow Jones Newswires; 416-306-2020; don.curren@dowjones.com Click here to go to Dow Jones NewsPlus, a web front page of today's most important business and market news, analysis and commentary: http://www.djnewsplus.com/access/al?rnd=uhZWDuT8N%2Fh45Ys7RP60FQ%3D%3D. You can use this link on the day this article is published and the following day.

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