USD/CAD Downside potential for Loonie still looks limited – Scotiabank

FXStreet Insights Team FXStreet

USD/CAD holds around 1.38. Economists at Scotiabank analyze the pair’s outlook.

The rebound looks no more than a consolidation

With no domestic data ahead, external drivers will remain key influences on the direction of the market in the short run but downside potential for the CAD from here still looks limited.

There are no clear signs from short-term price action that the USD rebound cannot extend a bit more but intraday price action has stalled in the low 1.38 area, with some minor congestion resistance doing enough to slow the USD recovery so far today.

The USD has put in a solid gain over the week so far but the rebound looks no more than a consolidation after last week’s big, bearish reversal from 1.39 – which should still mark very stiff resistance for funds.

Support intraday is 1.3790 and 1.3750.

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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.

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