9 Jul 2013
Flash: USD/CAD looks to upper ranges – TD Securities
FXstreet.com (London) - USD/CAD is consolidating after 1.0600 levels, and Research Teams at TD Securities note a number of readings that point towards the upside again.
They said the US 10-year bond has picked up around 100bps since the start of May and narrower short-term spreads (2-year Canada-US spreads are starting to narrow again after widening 20bps between April and the end of June) should limit scope for USD weakness near-term. They look for consolidation in funds after the run up to 1.0600 and they think USD/CAD corrective losses should be limited to the high 1.0400/low 1.0500 area for now. “Intraday price trends show USD/CAD pressing the upper ranges of the short-term bear channel/potential bull flag hourly chart. We should see resistance at 1.0565 this morning but a push above there should see spot regain 1.0600 pretty quickly.”
They said the US 10-year bond has picked up around 100bps since the start of May and narrower short-term spreads (2-year Canada-US spreads are starting to narrow again after widening 20bps between April and the end of June) should limit scope for USD weakness near-term. They look for consolidation in funds after the run up to 1.0600 and they think USD/CAD corrective losses should be limited to the high 1.0400/low 1.0500 area for now. “Intraday price trends show USD/CAD pressing the upper ranges of the short-term bear channel/potential bull flag hourly chart. We should see resistance at 1.0565 this morning but a push above there should see spot regain 1.0600 pretty quickly.”