USD/CAD: Range trading is weakening the downside momentum – Scotiabank

USD/CAD edges up to test 1.35. Economists at Scotiabank analyze the pair’s outlook.

Weak risk appetite and some further drift in crude oil prices are headwinds for the CAD

Weak risk appetite and some further drift in crude oil prices are headwinds for the CAD, in addition to the general strength in the USD. 

USD/CAD continues to consolidate in a bear wedge/flag pattern between support at 1.3425 (ahead of key support at 1.3395) and resistance in the 1.3510/1.3520 zone (40-DMA at 1.3515 today). 

The CAD has lost a little of the technical initiative that seemed to be developing on the charts as range trading is weakening the downside momentum behind the USD that had been developing over the past few sessions.