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11 Mar 2014
Flash: USD/CAD levels tipped 1.1150 top - BMO Capital Markets
FXStreet (Guatemala) - Stephen Gallo, European Head of Currency Strategy at BMO Capital explained that they are looking to the same levels in USD/CAD for the time being.
Key Quotes
“1.105-1.1075 acting as support and 1.115 acting as resistance. With the somewhat weaker oil price now off the radar screen again, favourable mid-term and long-term USD spreads appear to be the main culprits behind the supportive environment above 1.110 in USD/CAD since the end of last week. Indeed, based on the historical relationship between USD/CAD and the 5yr swap rate differential, 1.110 spot is just about right."
"We expect USD/CAD topside to be capped at 1.115 today. But given some of the aforementioned trends and the better US employment data on Friday, the retail sales report on Thursday is a potential trigger for a move into the 1.118-1.122 range. Short-term FX investors remain short of the CAD at current levels, but not overly so."
Key Quotes
“1.105-1.1075 acting as support and 1.115 acting as resistance. With the somewhat weaker oil price now off the radar screen again, favourable mid-term and long-term USD spreads appear to be the main culprits behind the supportive environment above 1.110 in USD/CAD since the end of last week. Indeed, based on the historical relationship between USD/CAD and the 5yr swap rate differential, 1.110 spot is just about right."
"We expect USD/CAD topside to be capped at 1.115 today. But given some of the aforementioned trends and the better US employment data on Friday, the retail sales report on Thursday is a potential trigger for a move into the 1.118-1.122 range. Short-term FX investors remain short of the CAD at current levels, but not overly so."