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26 Feb 2015
USD/CAD target remains unchanged at 1.300 in medium term – Westpac
FXStreet (Edinburgh) - A case for USD/CAD climbing towards the 1.3000 handle remains solid, commented strategists at Westpac.
Key Quotes
“The fundamental case for 1.30+ on a 3 month horizon remains solid”.
“Another BoC rate cut on 4 March is almost fully priced in (80% probability) but we expect a very cautious tone to their statement and for markets to continue to flirt with the possibility of additional easing beyond March”.
“On oil, the falling rig count is a poor gauge of prospective supply - drillers typically idle the most marginal rigs first and work more productive rigs harder. And, as the US nat gas market shows producers can bleed cash for years, resulting in ample supplies and depressed prices for years”.
“Last week’s rise has shifted medium term momentum from negative to neutral, while short term momentum has shifted to a positive bias for the first time in February. This implies that the period of consolidation is likely over and price should return to the uptrend. Medium term target of 1.3000 still stands”.
Key Quotes
“The fundamental case for 1.30+ on a 3 month horizon remains solid”.
“Another BoC rate cut on 4 March is almost fully priced in (80% probability) but we expect a very cautious tone to their statement and for markets to continue to flirt with the possibility of additional easing beyond March”.
“On oil, the falling rig count is a poor gauge of prospective supply - drillers typically idle the most marginal rigs first and work more productive rigs harder. And, as the US nat gas market shows producers can bleed cash for years, resulting in ample supplies and depressed prices for years”.
“Last week’s rise has shifted medium term momentum from negative to neutral, while short term momentum has shifted to a positive bias for the first time in February. This implies that the period of consolidation is likely over and price should return to the uptrend. Medium term target of 1.3000 still stands”.