CAD firms into low 1.38s on broad USD weakness – Scotiabank

💡 DMK Insight

The CAD’s rise to the low 1.38s signals a key shift in USD strength, and here’s why that’s crucial for traders: This movement isn’t just a CAD story; it’s a reflection of the USD’s broader weakness, which could have ripple effects across various currency pairs. Traders should be on the lookout for how this trend plays out against other major currencies, particularly the Euro and the Yen, as shifts in USD strength often lead to correlated moves. If the CAD continues to gain traction, it could challenge resistance levels around 1.37, which would be a significant psychological barrier. Monitoring economic indicators from both Canada and the U.S. will be essential, especially any data releases that could impact interest rate expectations. But here’s the flip side: if the USD finds support and reverses, we could see a quick pullback in the CAD. Keep an eye on the daily charts for any signs of reversal patterns. Watch for any news or data releases that might shift sentiment, particularly around inflation or employment figures in the U.S. over the coming weeks.