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USD/CAD: USD IS LOOKING OVERSOLD ON THE SHORT-TERM – SCOTIABANK

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The Canadian Dollar (CAD) has slipped a little so far today after grinding higher through 1.3450 yesterday, Scotiabank's Chief FX Strategist Shaun Osborne notes.

CAD edges off highs but holds in upper 1.34s

“CAD losses are limited in the grander scheme of things though and the solid gains in the CAD through August so far is surely putting the squeeze on the aggressive buildup of CAD short positioning that developed through the middle of the year—just as the CAD troughed.”

“Spot continues to trade a little below our estimated fair value equilibrium of 1.3521, which may constrain CAD short-covering gains somewhat. There are no Canadian data reports today. Q2 Current Account data is out tomorrow and June/Q2 GDP is updated on Friday. Steady spot gains on the session so far may develop a little more traction above 1.3470/75 resistance on the day to regain 1.35 .”


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