Forex Flash: Buy USD/CAD dips while key support at 1.01 holds – TD Securities

FXstreet.com (Barcelona) - Market consensus points to a robust 3.0% advance reading of US Q1 GDP, but such growth “may be a little suspect (inventories) and the more recent slowdown worries—reflected in the consistently disappointing US data outcomes relative to expectations—are perhaps more relevant for investors”, wrote TD Securities analysts Shaun Osborne and Greg Moore, seeing the USD/CAD near-term downside risks to extend to the 1.0175 area (measured move target of the 1.0291/34 breakdown). “We continue to view modest USD/CAD dips as a buy while key support at 1.01 holds”, they said.

“We noted yesterday that the CAD’s correlation with (US) stocks had firmed up again so it is highly unlikely that the CAD would be able to ignore any marked downturn in risk assets—which we think remains a strong possibility in the next couple of weeks. We are entering the seasonally soft period for equities and global growth worries may compound the trend”, TD Securities analysts concluded.