USD/CAD seen around 1.30 in 9-month – Rabobank

Christian Lawrence, Senior Market Strategist at Rabobank, assessed the prospects for the Canadian Dollar in the next months.

Key Quotes

“USD/CAD touched a low of 1.2251 at the end of January before trending up to a high of 1.3125. The downtrend from there formed a textbook head and shoulders pattern and the break of the neckline at 1.28 targeted a move down to 1.25”.

“Going forward, the combination of weakening domestic data, a pause in tightening and a more bullish outlook for USD all pose upside risks for USD/CAD. In terms of downside risks for USD/CAD, if we see a renegotiated NAFTA then this will provide support for CAD. Furthermore, although not our base case, if oil prices continue to rally then this will help boost demand for CAD”.