8 Aug 2013
Flash: USD/CAD a buy on USD dips – TD Securities
FXstreet.com (New York) - The TD Securities Team analyzes the USD/CAD and AUD/CAD and their respective trajectories.
Key quotes
“We noted yesterday that longer-term price signals (bullish weekly reversal) signaled to us that an important low had formed in USD/CAD. Now, the USD is doing a decent job of proving us right. Gains through the 40-day MA confer a bit more strength on the daily picture, bolstering the bullish signals noted over the other timeframes.”
“Crucially, we spot an bullish alignment of trend strength indicators on the short, medium and long-term timeframes that suggests a strong move higher is unfolding here, with limited scope for counter-trend corrections – modest USD dips (upper 1.03s) are a buy.”
Meanwhile, “the AUD/CAD is stabilizing but the rebound in the AUD has remained limited so far, in line with our expectations. We continue to see limited scope for AUD gains, absent a stronger sign that the market is reversing or a material weakening in the broadly aligned trend strength oscillators. This remains a very minor rebound in the context of recent weakness and we think there may be more downside potential here overall. AUD/CAD gains may extend into the 0.9350/0.9450 area but we continue to view such rebounds as a selling opportunity.”
Key quotes
“We noted yesterday that longer-term price signals (bullish weekly reversal) signaled to us that an important low had formed in USD/CAD. Now, the USD is doing a decent job of proving us right. Gains through the 40-day MA confer a bit more strength on the daily picture, bolstering the bullish signals noted over the other timeframes.”
“Crucially, we spot an bullish alignment of trend strength indicators on the short, medium and long-term timeframes that suggests a strong move higher is unfolding here, with limited scope for counter-trend corrections – modest USD dips (upper 1.03s) are a buy.”
Meanwhile, “the AUD/CAD is stabilizing but the rebound in the AUD has remained limited so far, in line with our expectations. We continue to see limited scope for AUD gains, absent a stronger sign that the market is reversing or a material weakening in the broadly aligned trend strength oscillators. This remains a very minor rebound in the context of recent weakness and we think there may be more downside potential here overall. AUD/CAD gains may extend into the 0.9350/0.9450 area but we continue to view such rebounds as a selling opportunity.”