Analysts at TD Securities explained that since the Bank of Canada’s meeting in January, USDCAD’s move lower has been extensive.
Key Quotes:
“The 8% correction over the last 30 days is the largest move since 2009. And, despite the broad USD rally since the February 11th lows, the CAD has been unique as the major outperformer in the G10 complex.
We think the move lower has gone too far down the rabbit hole and beyond the point driven by relative fundamentals and more by momentum. While momentum can extend further, the downside is less compelling from here and is closer to a point that will make the Bank of Canada uncomfortable due to an implicit tightening in financial conditions and possibly lean against the strength in CAD. “
(Market News Provided by FXstreet)