12 Feb 2015
Limited downside for USD/CAD in the near-term – TDS
FXStreet (Barcelona) - Shaun Osborne, Chief FX Strategist at TD Securities, comments on the recent boost in oil inventories, and further adds that USD/CAD would be slave to flows and technical factors on the absence of any key Canadian data.
Key Quotes
“Oil prices have firmed again a little overnight, to extend the CAD a modest boost but the headwinds against a sustained rebound in oil prices were evident yesterday in the EIA data.”
“Crude oil stockpiles gained nearly 5 mn barrels to 418mn barrels in the latest weekly data, the highest on record. Bloomberg pointed out that the last time crude inventories were above 400mn, it was reflected only in monthly data and the date was 1931.”
“With US production still increasing, oil fundamentals suggest that lower prices still are likely before supply/demand factors becomes more balanced.”
“With only second-tier data on tap in Canada and more important figures out in the US, USDCAD will once again be a slave to the flows and technical factors again today.”
“After trading up to 1.27 yesterday, the undertone looks soft in the short run again this morning.”
“We see support in the low 1.25s which should be reinforced by spot moving close to 1 Standard Deviation away from our fundamental fair value assessment for USDCAD currently which stands at 1.2660.”
Key Quotes
“Oil prices have firmed again a little overnight, to extend the CAD a modest boost but the headwinds against a sustained rebound in oil prices were evident yesterday in the EIA data.”
“Crude oil stockpiles gained nearly 5 mn barrels to 418mn barrels in the latest weekly data, the highest on record. Bloomberg pointed out that the last time crude inventories were above 400mn, it was reflected only in monthly data and the date was 1931.”
“With US production still increasing, oil fundamentals suggest that lower prices still are likely before supply/demand factors becomes more balanced.”
“With only second-tier data on tap in Canada and more important figures out in the US, USDCAD will once again be a slave to the flows and technical factors again today.”
“After trading up to 1.27 yesterday, the undertone looks soft in the short run again this morning.”
“We see support in the low 1.25s which should be reinforced by spot moving close to 1 Standard Deviation away from our fundamental fair value assessment for USDCAD currently which stands at 1.2660.”