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Axel Rudolph, Senior Analyst at Commerzbank, assessed the prospects for the pair.

Key Quotes

“In early May USD/CAD‘s advance has nearly taken it to the early March high at 1.3001 before it dropped to the current May low at 1.2730 before rallying again”.

“Once the recent high at 1.3001 has been overcome, the long term downtrend line at 1.3056 and the March high at 1.3124 will be in focus”.

“The next higher 1.3588/97 November and December 2016 highs remain our longer term upside targets for the course of this year, provided that the April low at 1.2529 underpins”.

“Only unexpected failure there would put the 1.2452/40 mid-February low and the 78.6% Fibonacci retracement on the cards. This is not our preferred view, though”.

“Further support can be spotted at the 1.2357 early January low and also at the 1.2254 January trough. While it underpins we will retain our longer term still bullish view”.