Strong rallies in Copper and Platinum along with another stellar day inthe equity markets helped drive the USD CAD sharply lower on Thursday.
Strong rallies in Copper and Platinum along with another stellar day in the equity markets helped drive the USD CAD sharply lower on Thursday.
Traders are buying the Canadian Dollar on the hopes that an economic recovery in the U.S. will lead to greater demand for key Canadian exports such as industrial metals. This would help improve the Canadian export market as well as increase the trade surplus.
Traders are also expressing their confidence that the Bank of Canada made the right move by refraining from applying quantitative easing to stimulate the economy. This action earlier in the month seemed to set the tone of the current rally.
Technically the daily trend is down for the USD CAD. The big test will come on the weekly chart however. This chart is indicating that a break through 1.1759 will turn the weekly trend down and confirm the double-top at 1.3015 and 1.3062. The downside objective of this pattern is 1.0456.