USD/CAD deflates to 1.0950

FXStreet (Edinburgh) - The US dollar is now rapidly depreciating vs. its Canadian counterpart, pushing the USD/CAD to test back the mid-1.0900 area.

USD/CAD softer post-data

After hitting multi-week highs near the psychological 1.1000 handle, spot is now surrendering early gains and returning to the 1.0955/50 band following strong Canadian trade data. During June, the Canadian economy posted a $1.86 billion surplus, more than three times the $0.58 billion registered in May, giving oxygen to the CAD and collaborating in the pair’s correction from intraday highs. “Next key topside focus will be around the 1.1000 area, and a break through there should set up an assault on the range highs seen earlier this year above 1.1200”, noted Stephen Gallo, European Head FX Strategy at BMO.

USD/CAD levels to consider

At the moment the pair is losing 0.05% at 1.0955 and a break below 1.0949 (50% of 1.1279-1.0620) would expose 1.0887 (100d-MA) and then 1.0850 (low Jul.30). On the flip side, the initial resistance aligns at 1.1007 (high May 2).