CAD softer versus USD but pick up on the crosses – Scotiabank

The Canadian Dollar (CAD) is softer against the generally stronger US Dollar (USD) on the session but losses are relatively limited, leaving the CAD the top-performer after the big dollar among G10 currencies, Scotiabank's Chief FX Strategists Shaun Osborne and Eric Theoret report.

Trend strength oscillators are neutral

"That provides the CAD with a little further relief on the crosses after EURCAD’s push to it is highest since 2009 late last month. Weaker US bond markets may put a little pressure on the recent narrowing in US/Canada yield spreads while weaker global risk appetite will help keep the CAD tone defensive versus the USD for now."

"Despite positive developments on the charts for the CAD recently—USD/CAD’s bearish outside range reversal pattern (from August 22nd) and losses through minor trend support off the July 23rd low last week, the CAD has found it hard to sustain gains through the 40-day MA (1.3774)."

"Trend strength oscillators are neutral on the daily and weekly charts, which may make for choppy trading, albeit with a developing downward bias. Support is 1.3575 (July 23rd low) and 1.3540 (mid -June low). Resistance is 1.3785/1.3815 and 1.3880/90."