Scotiabank strategists Shaun Osborne and Eric Theoret report that the Canadian Dollar (CAD) is little changed, with USD/CAD trading near 1.36 as traders await developments regarding US/Iran headlines and the upcoming Canadian employment data scheduled for Friday [1]. The spot rate remains above Scotiabank’s fair value estimate, which has edged higher to 1.3514 due to recent movements in stocks and crude oil markets [1].
The strategists highlight that the broader USD/CAD downtrend remains intact, characterizing recent USD gains as a bear flag within a still bearish technical setup [1]. The USD crept above resistance in the low 1.36 range (1.3625/30) but remains close to that level, with price action through European trade described as mildly USD-negative [1]. Technical analysis suggests that USD losses should resume below 1.3590, with resistance now marked at 1.3645/50 [1].
Market participants are showing limited incentive to push the CAD decisively in either direction, given the lack of domestic data releases and subdued crude oil prices [1]. The strategists note that the CAD remains undervalued relative to their fair value estimate, but risk appetite is restrained as traders await further news [1].
No forward-looking analyst opinions beyond the technical outlook and anticipation of the Canadian employment report are provided in the source [1].
CONCLUSION
The USD/CAD pair remains in a bearish technical setup, with the broader downtrend intact despite recent mild USD gains. Market participants are largely in a holding pattern, awaiting key Canadian employment data and potential US/Iran developments, with technical resistance and support levels closely watched.