USD/CAD nudged above Friday’s 1.0033 but has been unable to muster any further momentum ahead of the 50% retracement of the June-Sept drop.
Given the recent drop in stock markets and oil, the Canadian dollar has been surprisingly resilient but there is only so much pain this pair can withstand. Speculators are heavily short USD/CAD — if it begins to gather upside momentum, look out.
Stocks are opening lower and look for them to take charge until 1700 GMT, when Fin Min Flaherty will release updated budget forecasts. Local press reports suggest estimates are on target but warnings about the 2013 and 2014 budgets could boost USD/CAD.