#SaxoStrats: USDCAD heading to test 1.3300 post BoC
The tremendous CAD rally on the back of a recovery in crude prices from January and into late April has faded rapidly, as higher oil prices are seen as having less potential to drive economic growth in Canada unless prices accelerate considerably from here.
Management and risk description
The key risk to the trade is that the risk parameters have been set a bit too tightly and/or that Canadian data today (CPI and Retail Sales) surprise to the upside or that the Bank of Canada’s guidance next week proves less dovish than expected.
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Time horizon: approx. 1 week
USDCAD longterm (5yr) chart (click to enlarge)
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