May 6, 2013
Forex Flash: USD/CAD to rise on USD strength and CAD underperformance – TD Securities
FXstreet.com (Barcelona) - TD Securities analysts think the broader USD direction is higher overall: “Regardless of the “soft patch” of slower growth the US data have been reflecting recently, the US economy will be growing head and shoulders above Europe and Japan through 2014. In the event of any setback for risk (something we consider still quite possible), the USD should benefit from safe-haven demand, meanwhile”, wrote analysts Shaun Osborne and Greg Moore, adding that CAD is to under-perform in the months ahead with Canada’s large current account deficit (3.8%/GDP versus the relatively smaller—and shrinking—US shortfall at 2.5%/GDP) as one of the reasons behind it. “From a technical perspective, we still think the turn up from 1.0050 last week has provided a firm base for the market ahead of medium-term support (200-day MA) around the par zone. Minor resistance is 1.0150”, they said.