OctaFX | OctaFX Forex Broker
Open trading account
Back

USD/CAD: 1.28/1.29 key area of support

FXStreet (Guatemala) - USD/CAD has popped higher through the 200 SMA on the hourly sticks that resides at 1.2967 currently, targeting 1.3000 and last week's highs of 1.3080. The pair recovers on the back of WTI slipping to the lower of $46.00. The greenback continues to pair losses across the board leaving the upside vulnerable.

A big week for USD/CAD

It is a big week for Canada and Loonie traders with the BoC, retails sales and CPI's that all full due. Analysts at Bank or America Merrill Lynch explained, "Near-term growth has been solid after a 1H contraction, but ample slack and persistent headwinds will prevent the BoC from adopting any hawkishness.

The October meeting includes the release of the MPR, where we see the BoC upgrading 3Q 2015 GDP growth to around 3% from 1.5%. But, despite better near-term growth, we don't expect a notable shift in the tone of the BoC's policy statement, MPR or press conference, given continued economic headwinds."

USD/CAD levels

Technically, USD/CAD weakness has targeted the 200 DMA having dropped below the 50 DMA with the 20/50 bearish cross forming in this new cycle. Analysts at TD Securities explained, "A weaker CAD has helped to facilitate the rotation, but the latest trade balance figures revealed a rollover in FX-sensitive exports. It remains premature still to determine whether this is a warning sign of things to come, but it does suggest that CAD strength will be limited."

"We still view the 1.28/1.29 region as a very important area for USD/CAD and we think that it still offers some appeal to add small longs from a strategic perspective (i.e. a weak CAD will need to persist to facilitate the structural realignment in the economy). Our fair value estimate today sits at 1.2812."

USD/CAD short-term extreme overbought

USD/CAD short-term extreme overbought
Read more Previous

USD/JPY hovering around 119.40

USD/JPY continues to trade around Friday’s closing price in a small trading range. The pair reached daily extremes during the Asian session when it bottomed at 119.11 and then peaked at 119.62.
Read more Next
Start livechat