USD/CAD bullish near-term – Scotiabank

The pair’s perspective keeps pointing upwards in the near term, according to Eric Theoret, FX Strategist at Scotiabank.

Key Quotes

“The broader tone remains dominant and CAD continues to trade in tandem with oil prices as we note the ongoing disconnect to yield spreads. A renewed widening in the 2Y U.S.-Canada yield spread would likely pressure CAD (support USDCAD)”.

“USDCAD is struggling to break above its 100 day MA following the bullish resolution of its triangular consolidation from early May. Momentum indicators are bullish and the 9 day MA has broken above its 21 day MA. We look to further upside with a focus on the May 24 high 1.3188 followed by our long anticipated 1.33-1.35 range. Near-term support is expected at 1.2950”.