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USD/CAD Better Supported in Quiet Trade – TD Securities

FXStreet (Barcelona) - The Forex Research Team at TD Securities highlight the factors responsible for the USD/CAD 80-point rally yesterday, and view the broader trend for the pair to remain on the higher side.

Key Quotes

“A negative surprise on Canadian housing starts, market speculation that the US October’s job report had been penalized by a questionably large seasonal factor discount, and a sizeable decline in crude oil prices due to headlines suggesting OPEC will not reduce crude oil supply at its upcoming meeting all conspired to send USDCAD higher on an 80-point rally to a close at 1.1381 yesterday.”

“On the charts, the offered tone for USDCAD we expected to prevail yesterday has quickly evaporated but the USD-negative price signals that we noted on the daily charts from last week remain intact and suggest that although USDCAD has bounced over the last 24 hours, gains may not extend too far for the moment.“

“We still rather think the USD may soften modestly in the next week or little more in light of the bearish short-term technical signals that evolved last week.“

“The broader trend remains firmly higher, however, and we think short-term weakness will give way to medium-term gains in funds moving into 2015.”

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