In view of FX Strategists at Scotiabank, the pair’s near term stance remains neutral/bearish and spot could drop to the sub-1.3000 zone.
Key Quotes
“Drivers are mixed as domestic oil prices remain soft and yield spreads consolidate. Measures of sentiment have offered recent support on the back of an improvement in the tone of trade negotiations and have allowed for a modest firming in domestic rate expectations. OIS are almost fully pricing in one 25bpt BoC rate hike by December”.
“Momentum indicators are modestly bearish and the DMI’s are confirming. The recent three session consolidation range has been remarkably tight with congestion observed between 1.3050 and 1.3080. We look to an extension of USDCAD‘s recent decline, targeting a break of 1.3000 and a push toward the 100 day MA in the mid/upper-1.29s”.
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