USD/CAD outlook seen neutral near term – Scotiabank

Eric Theoret, FX Strategist at Scotiabank, sees the short-term stance of the pair leaning to the neutral camp.

Key Quotes

“We are biased to medium-term CAD weakness and note the remarkable lack of improvement in measures of sentiment as risk reversals continue to price a relatively sizeable premium for protection against CAD weakness”.

“Momentum signals are remarkably neutral, DMI’s are low and the ADX is in trendless (sub-25) territory at 16. USDCAD has fallen back into the symmetrical triangle formed since the early May low and appears set to attempt a test of the 38.2% Fibo retracement level of the May rally at 1.2911”.