The CAD has been gaining strength in recent days as crude oil prices move higher following speculation that oil producers will reduce supplies. Also, providing some support for the CAD is the fact that the BoC left rates unchanged when the markets were forecasting a cut by 25 basis points. CAD traders for today should keep an eye on today’s Canadian economic calendar since on tap are the November GDP and Dec Product price Index. Also, keep an eye out for the U.S. Advance GDP q/q data released later today; this could also impact the USDCAD volatility for Friday.
Technically, for the USDCAD I am expecting a price bounce in the wake of the corrective sell off since the pair hit a multiyear high near the 1.4680’s last week. USDCAD traders may look to enter into long positions within the “Price bounce zone” ((B1) above chart) between 1.3815 – 1.3970, for targets within the “Lower top zone” ((T2?) above chart) 1.4340 – 1.4430.
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Senior Currency Strategist
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