The outcome of the OPEC meeting is on 30 November
Barclays Capital FX Strategy Research notes that this week's OPEC meeting, along with Canada's Q3 GDP and November employment reports (both due on 1 December) may trigger a softer loonie as we end the week.
"OPEC could disappoint market expectations and Canada's GDP is likely to show a slower pace of activity in Q3. A lower-than-expected GDP print could weigh on the loonie, as the BoC counts on broad and sustained growth to yield price pressures. We forecast quarterly GDP to have slowed to 0.60% q/q annualized in Q3 (previous: 4.5%), bringing total annual growth down to 2.84% y/y," Barclays argues.
In line with this view, Barclays recommends being long USD/CAD from 1.2696 as its trade for this week, targeting 1.2890 with a stop of 1.26 (above the 100-day moving average) for a reward-to-risk ratio of 2:1.
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