CAD hits strongest level since September – Scotiabank

FXStreet Insights Team FXStreet

The Canadian Dollar (CAD) is extending its steady outperformance, backed by supportive rate differentials and a weakening US Dollar (USD) trend. While stretched short-term signals suggest a brief pause or rebound is possible, technicals still favor further downside toward the 1.35–1.36 region, Scotiabank's Chief FX Strategists Shaun Osborne and Eric Theoret report.

USD trend turns bearish but near-term bounce possible

"The CAD is maintaining a marginal gain on the session to trade at its strongest level since Sep against the USD. A third net weekly gain for the CAD is its best performance since Apr. Spreads remain supportive of the CAD’s firmer undertone and we think the outlook for relative monetary policy will remain a positive driver for the CAD moving forward."

"A weekly close below 1.3769 (61.8% retracement of the H2 USD rally) will help keep broader focus on the downside and strengthen the risk of a push back to 1.35/1.36 in the next few weeks. Trend momentum oscillators are aligning bearishly for the USD but the short-term studies are looking a little stretched which could mean the USD slide steadies or even reverses a little before the broader bear trend resumes."

"That alignment of bearish trend momentum oscillators should, however, mean that USD losses are limited in terms of scale and duration and will offer USD sellers an opportunity to fade gains. Resistance is 1.3850/75 and 1.3900/40."

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

EUR/USD flirts with daily highs, retargets 1.1900

EUR/USD regains upside traction, returning to the 1.1880 zone and refocusing its attention to the key 1.1900 barrier. The pair’s slight gains comes against the backdrop of a humble decline in the US Dollar as investors continue to assess the latest US CPI readings and the potential Fed’s rate path.

GBP/USD remains well bid around 1.3650

GBP/USD maintains its upside momentum in place, hovering around daily highs near 1.3650 and setting aside part of the recent three-day drop. Cable’s improved sentiment comes on the back of the Greenback’s irresolute price action, while recent hawkish comments from the BoE’s Pill also collaborate with the uptick.

Gold clings to gains just above $5,000/oz

Gold is reclaiming part of the ground lost on Wednesday’s marked decline, as bargain-hunters keep piling up and lifting prices past the key $5,000 per troy ounce. The precious metal’s move higher is also underpinned by the slight pullback in the US Dollar and declining US Treasury yields across the curve.

Crypto Today: Bitcoin, Ethereum, XRP in choppy price action, weighed down by falling institutional interest

Bitcoin's upside remains largely constrained amid weak technicals and declining institutional interest. Ethereum trades sideways above $1,900 support with the upside capped below $2,000 amid ETF outflows.

Week ahead – Data blitz, Fed Minutes and RBNZ decision in the spotlight

US GDP and PCE inflation are main highlights, plus the Fed minutes. UK and Japan have busy calendars too with focus on CPI. Flash PMIs for February will also be doing the rounds. RBNZ meets, is unlikely to follow RBA’s hawkish path.

Ripple Price Forecast: XRP potential bottom could be in sight

Ripple edges up above the intraday low of $1.35 at the time of writing on Friday amid mixed price actions across the crypto market. The remittance token failed to hold support at $1.40 the previous day, reflecting risk-off sentiment amid a decline in retail and institutional sentiment.