The Canadian Dollar (CAD) has experienced a slight decrease in value today after reaching a high of 1.3450 yesterday, according to Scotiabank’s Chief FX Strategist Shaun Osborne.
CAD Holds Strong in Upper 1.34s
Osborne notes that while the CAD has seen some losses recently, the overall trend has been positive throughout August. This positive movement in the CAD is causing short positions on the currency to be squeezed, as the CAD was at its lowest point earlier in the year.
Despite trading slightly below the estimated fair value equilibrium of 1.3521, the CAD is expected to continue its upward trend. With no significant Canadian data reports today, attention is turning to the Q2 Current Account data tomorrow and June/Q2 GDP update on Friday.
While the USD may experience a slight rebound, it is unlikely to impact the strong performance of the CAD in August. Resistance for the USD is at 1.3545/50, with support at 1.3440. Although the USD may seem oversold in the short term, the current downtrend suggests that a reversal is unlikely at this time.
Analysis:
The Canadian Dollar (CAD) has shown resiliency in the face of minor setbacks, maintaining a strong position in the upper 1.34 range. Analysts predict that the CAD’s positive trend in August will continue, potentially reaching above 1.35. While the USD may see a slight rebound, the overall downtrend suggests that significant gains are unlikely in the near future. Investors should keep an eye on upcoming data reports for further insights into the CAD’s performance.