29 Oct 2013
Flash: USD/CAD hinges on FOMC meeting – Scotiabank
FXstreet.com (Edinburgh) -Chief Strategist Camilla Sutton at Scotiabank expects the FOMC meeting due tomorrow to be the main catalyst for the USD/CAD price action in the short term.
Key quotes
“Since Governor Poloz and the BoC turned from a hawkish to neutral stance, CAD has lost 1.6%. However, with AUD and NZD having fared worse we would suggest the FX reaction is not all about the BoC shift but also about a tightening in monetary conditions in China and ongoing growth concerns”.
“We do not expect any surprises from the governor and expect tomorrow’s FOMC release to be the key driver for USDCAD in the near‐term”.
“Technicals still suggest USDCAD upside risk, with 1.05 the near-term level followed by the August high of 1.0568. The MACD is in buy territory, spot is showing upside momentum and the trend is still rising. Accordingly, we favour trading USD/CAD from the long side looking
for a near‐term test of 1.05”.
Key quotes
“Since Governor Poloz and the BoC turned from a hawkish to neutral stance, CAD has lost 1.6%. However, with AUD and NZD having fared worse we would suggest the FX reaction is not all about the BoC shift but also about a tightening in monetary conditions in China and ongoing growth concerns”.
“We do not expect any surprises from the governor and expect tomorrow’s FOMC release to be the key driver for USDCAD in the near‐term”.
“Technicals still suggest USDCAD upside risk, with 1.05 the near-term level followed by the August high of 1.0568. The MACD is in buy territory, spot is showing upside momentum and the trend is still rising. Accordingly, we favour trading USD/CAD from the long side looking
for a near‐term test of 1.05”.