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With commodities expected to move higher in due course, USD/CAD and indeed commodity currencies remain some of Credit Suisse’s favored expressions of USD weakness. Whilst a cluster of key supports at 1.2060/48 may continue to hold near-term, an eventual sustained break to establish a multi-year top for USD/CAD is also expected.

USD/CAD has now reached the 1.2060/48 2017 low

“With commodities expected to continue higher in due course, the commodity currencies should continue to benefit, with USD/CAD one of our favored expressions.”

“The loonie is struggling to break decisively below regime defining support at the 1.2060/48 2018 low and 50% retracement of the rise from 2011. However, a weekly close below 1.2060/48 in due course would complete a multi-year ‘double top’ to significantly reinforce our bearish outlook.”  

“Next supports are then seen at 1.1916, with little below here until 1.1424/1.1318, which is the uptrend from 2011 and 61.8% retracement of the same move.”