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30 Oct 2015
USDCAD: Short term downside contained within broader uptrend - TDS
FXStreet (Delhi) - Ned Rumpeltin, European Head of Currency Strategy at TD Securities, notes that despite the underlying guts of the first read of US GDP pointing to decent private sector demand, USDCAD ground lower thought the rest of the North American session yesterday.
Key Quotes
“USDCAD has had trouble staying above the 1.32 mark this week and today's industry level Canadian GDP report for August is likely to add some additional downside pressure. There, we expect a slightly better rate of growth than the market (TD: 0.2%, market: 0.1%).”
“Crude oil remains bid and month end rebalancing flows should see the USD soften as equities staged a solid rally this month. But we still view any near term downside in USDCAD contained within a broader uptrend and from a strategic perspective we still like playing this pair from the long side especially now that the Fed has shifted to a more hawkish stance. 1.3100/20 should be key support but we would look to add to longs in the 1.3050/80 zone, which is not far off where fair value stands today (1.3070).”
Key Quotes
“USDCAD has had trouble staying above the 1.32 mark this week and today's industry level Canadian GDP report for August is likely to add some additional downside pressure. There, we expect a slightly better rate of growth than the market (TD: 0.2%, market: 0.1%).”
“Crude oil remains bid and month end rebalancing flows should see the USD soften as equities staged a solid rally this month. But we still view any near term downside in USDCAD contained within a broader uptrend and from a strategic perspective we still like playing this pair from the long side especially now that the Fed has shifted to a more hawkish stance. 1.3100/20 should be key support but we would look to add to longs in the 1.3050/80 zone, which is not far off where fair value stands today (1.3070).”