Conflicting signals at the end of last week meant that this week’s outlook was neutral. That situation was resolved with, after an Asian dip, a renewal of investor demand. This took USDCAD
more than 1 ¼ big figures higher – to new 4 week highs. The scope of the move means intraday signals for sentiment are overbought, especially after further upside in Asia, but we now look for any setbacks to be temporary. In view of this, our call for Tuesday is a Modest Buy from the open but leaving room to also Buy any Dip to 1.2505. The risk is 1.2468 with an immediate target of 1.2566, Asian high. A move through that point then exposes sentiment to 1.2590, the 4 week top, or even towards 1.2641, the 5 week high.