USD/CAD keeps the bullishness intact near term – Scotiabank

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FX Strategist at Scotiabank Eric Theoret noted the pair’s outlook remains bullish in the short-term horizon.
Key Quotes
“In terms of drivers, we highlight the renewed widening in the 2Y U.S.-Canada yield spread, above 20bpts with a 5bpt jump from last Thursday. The drag from spreads may be offset by signs of strength in oil prices following Tuesday’s API inventory draw”.
“We look to a broadly USD positive reaction, presenting downside risk to CAD on the back of a widened yield spread and lower USD-denominated oil price”.
“USDCAD is testing 9 day MA (1.3154) support around the lower end of its one week range, however signals remain broadly bullish across both trend and momentum indicators”.
“Recent congestion has centered around 1.32 and we maintain expectations for gains through the late July high at 1.3253 and 200 day MA at 1.3255 toward the 1.33 and 1.35—levels that roughly coincide with the major retracement levels of the January-May decline”.
  
   

• 1 Week
  
• 1 Month
  
• 1 Quarter
  

   1 Week
  Avg Forecast 1.3136
100.0%78.0%22.0%0203040506070809010000.10.20.30.40.50.60.70.80.910  


  

• 22% Bullish
  
• 56% Bearish
  
• 22% Sideways
  

Bias Bearish


  1 Month
  Avg Forecast 1.3228
100.0%84.0%42.0%040506070809010000.10.20.30.40.50.60.70.80.910  


  

• 42% Bullish
  
• 42% Bearish
  
• 17% Sideways
  

Bias Bullish


  1 Quarter
  Avg Forecast 1.3254
100.0%77.0%46.0%0455055606570758085909510010500.10.20.30.40.50.60.70.80.910  


  

• 46% Bullish
  
• 31% Bearish
  
• 23% Sideways
  

Bias Bullish



Updated Sep 16, 14:00 GMT