FXStreet (Barcelona) – FX Strategists at TD Securities, see near-term risks for USD/CAD towards the 1.21 handle, but suggest buying any dips for USD gains ahead.
Key Quotes
“We continue to view H2 as offering better prospects for the USD versus the CAD in particular as either the US economy rebounds and the Fed tightens policy, boosting the USD, or sluggish North American growth trends persist, resulting in renewed focus on BoC policy prospects and a weaker CAD.”
“Near-term, we do not exclude the risk of USDCAD dropping back to the 1.21/1.22 range but we also think that would be an opportunity to open or add to long USD positions.”
“Weak price action since late last week leaves the market vulnerable to a drop through key short-term support at 1.2365/70 (double top trigger for a push down to the upper 1.21s); it remains to be seen whether still positive trend momentum on the longer-term studies can help underpin support in the high 1.23s and avert more weakness.”
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