Forex Flash: CAD/S&P 500 correlation close to 80-90% - TD Securities (Barcelona) - TD Securities analysts say that the CAD is the main under-performer among the G-10 currencies on the session, “though there does not appear to be an obvious catalysts for it—other than USD/CAD pushing through minor resistance in the high 0.98s and triggering some buy stops”, wrote analysts Shaun Osborne and Greg Moore. “We would expect the firmer tone to equity markets in the US to help support the broader CAD tone for the moment—or at least help limit losses”, they continued, adding that the CAD currently is close to 80-90% correlation to the S&P 500, and “only” 40% to crude oil.

"The market remains confined to a trading range for the move but the move above the 40-day MA does suggest potential for a somewhat higher USD from a technical perspective", they wrote, expecting USD/CAD gains to remain limited to the 0.9970 area (a clear move above here would be bullish), while intraday resistance is at 0.9910.