30 Jan 2014
Flash: USD/CAD targets the upper 1.12s - TD Securities
FXstreet.com (Bali) - According to Shaun Osbourne, Chief FX Strategist at TD Securities, next USD/CAD target is projected at the upper 1.12s.
Key Quotes
"USDCAD reached a fresh, if marginal, cycle high overnight—with the relief rally, however fleeting, in EM FX failing to register on the CAD’s radar at all. The CAD has been aloof to EM FX volatility to some degree—it held up well earlier in the week as the TRY came under severe pressure, for example—and continues to march more or less to its own beat."
"There are few obvious drivers behind the lower CAD through the overnight session—the CAD’s losses simply reflect the ongoing trend and, to some degree, Fed tapering expectation today."
"Less accommodation will contrast with the clearly dovish lilt at the BoC. Confirmation of the expected tapering decision today may serve as a catalyst to push USDCAD to or through 1.12 rather than providing any sort of “selling on the fact” relief."
"Technically, the trend higher in USDCAD may pause from a very short-term point of view after the push back from the intraday peak today. But the broad trend remains deeply entrenched in the market from a wide variety of timeframes and we expect losses to remain very limited in scale from here."
"We continue to target the upper 1.12s as the objective for the current move up. A clear and sustained push through 1.1236 (50% retracement of the 1.31/0.94 drop between 2009/2011) targets a push on to 1.1670. We see firm intraday support at 1.1090/00."
Key Quotes
"USDCAD reached a fresh, if marginal, cycle high overnight—with the relief rally, however fleeting, in EM FX failing to register on the CAD’s radar at all. The CAD has been aloof to EM FX volatility to some degree—it held up well earlier in the week as the TRY came under severe pressure, for example—and continues to march more or less to its own beat."
"There are few obvious drivers behind the lower CAD through the overnight session—the CAD’s losses simply reflect the ongoing trend and, to some degree, Fed tapering expectation today."
"Less accommodation will contrast with the clearly dovish lilt at the BoC. Confirmation of the expected tapering decision today may serve as a catalyst to push USDCAD to or through 1.12 rather than providing any sort of “selling on the fact” relief."
"Technically, the trend higher in USDCAD may pause from a very short-term point of view after the push back from the intraday peak today. But the broad trend remains deeply entrenched in the market from a wide variety of timeframes and we expect losses to remain very limited in scale from here."
"We continue to target the upper 1.12s as the objective for the current move up. A clear and sustained push through 1.1236 (50% retracement of the 1.31/0.94 drop between 2009/2011) targets a push on to 1.1670. We see firm intraday support at 1.1090/00."