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In view of FX Strategists at Scotiabank, the pair is expected to meet resistance in the mid-1.3100s ahead of the 1.3200/20 band in the short-term horizon.

Key Quotes

“Broader developments remain dominant and correlations suggest a continued focus on oil and commodities. Domestic risk is set to return as BoC Gov. Poloz and Sr. Dep. Gov. Wilkins are scheduled to appear before the House of Commons Finance Committee (3:30pm ET) to present the Bank’s latest MPR. The outlook for relative central bank policy is once again deteriorating as yield spreads retrace last week’s BoC-driven compression. Measures of implied CAD volatility are climbing and short-term risk reversals are showing signs of a turn. CAD remains vulnerable as WTI threatens a break of its recent ‘bear flag’.

USDCAD is consolidating within Friday’s range and hovering just above the upper bound of the broken channel from June (now at 1.3107). Daily momentum signals are modestly bullish and the DMI’s are confirming however the ADX trend strength indicator remains incredibly weak. Recent support has been observed below 1.3080 around the 100 day MA at 1.3076 and resistance is expected around 1.3150 with additional resistance in the 1.3200- 1.3220 area”.