Focus on USD/CAD

The Canadian dollar remains one of the key currencies to watch at the moment particularly given the volatility we’ve been seeing in oil prices.

Canadian Dollar
Source: Bloomberg

Oil is a key ingredient for Canada’s economy and with prices continuing to slip, the impact could be devastating. In fact, the Bank of Canada governor Stephen Poloz was on the wires this week saying the falling oil prices would have an ‘atrocious’ effect on the economy. In the absence of geopolitical risk, it seems there could be further downside for oil and in turn the CAD. Having said that, USD/CAD is an interesting pair to watch at the moment. The USD has been in fine form this week and heading into the non-farm payrolls reading, I feel traders will be looking to buy the dips in the greenback. Traders could look to buy USD/CAD on dips into 1.2600 with stops placed below 1.2500. Potential targets will be to 1.2800 which is where recent highs lie and there is a possibility we’ll see it nudge through that level.

 

USD/CAD
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This information has been prepared by IG, a trading name of IG Markets Limited and IG Markets South Africa Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. International accounts are offered by IG Markets Limited in the UK (FCA Number 195355), a juristic representative of IG Markets South Africa Limited (FSP No 41393). South African residents are required to obtain the necessary tax clearance certificates in line with their foreign investment allowance and may not use credit or debit cards to fund their international account.