USD/CAD to strengthen a little more towards 1.34/1.35 – Scotiabank

USD/CAD pressures support at 1.3390/1.3400. Economists at Scotiabank analyze the pair’s outlook. 

Gains to extend above 1.3390/1.3400

Despite Friday’s hefty intraday swings, the longer-term chart still points to the risk of USD/CAD strengthening a little more in the near-term, at least. 

The weekly chart shows a bullish ‘hammer’ candle developed through the turn of the year. A high close for the USD last week – despite the hefty intraday swings in the USD Friday – adds emphasis to the bullish pattern of trade and supports the outlook for some additional, corrective gains in the USD in the next few weeks towards 1.34/1.35.

Gains through high/low resistance at 1.3390/1.3400 will add to near-term bullish momentum.

Support should be firm on dips to the low/mid-1.33s now.