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USD/CAD shot higher on the dovish words of BOC Governor Stephen Poloz. But can it go even higher? Here is the view from BTMU:

Here is their view, courtesy of eFXnews:

BTMU Research discusses USD/CAD outlook, and notes that that  its valuation model based on the higher price of oil alone  suggests that USD/CAD should currently be trading  closer to the 1.2000-level rather than the 1.3000-level.

“At the current juncture, we still expect NAFTA talks to make further progress this year although acknowledge that the risk of an unfavourable outcome has increased.

In these circumstances, we still believe that USD/CAD will struggle to sustain levels back above the 1.3000  while the US dollar continues to weaken more broadly, BTMU argues.

Our bearish outlook for USD/CAD would be more seriously challenged by a breach of the 1.3200-level, which represents the next important technical resistance level beyond 1.3000,” BTMU adds.

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