CAD gives up some gains on weak risk mood – Scotiabank
|
The Canadian Dollar (CAD) is softer, losing ground against a generally stronger USD, Scotiabank's Chief FX Strategist Shaun Osborne notes.
USD’s technical undertone is weakening
"Tariffs are having an immediate impact on the domestic economy, with 6k auto workers temporarily idled by Stellantis as a result of this week’s tariff news. Our USD/CAD fair value estimate has weakened below 1.40 for the first time since November, largely reflecting the generally soft USD undertone.
"But that does shift the likely range for USD/CAD lower and limit the USD’s ability to strength – perhaps to somewhere around the 1.4250 area – for now. The USD is tracking a little higher intraday and short-term, corrective gains may extend modestly."
"But the USD’s technical undertone is weakening – the daily DMI study has flipped to USD-bearish for the first time since October – which should serve to limit the USD’s ability to strengthen and hold gains. Resistance sits at 1.4240/50, the start of a deep band of congestion that extends up to 1.4400/20. Fade USD gains."
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.