Trade idea from Mitsubishi UFJ
MUFG Research recommends selling CAD/NOK from 7.0000 wit ha target of 6.7500 and a stop at 7.1425.
"We are recommending a short CAD/NOK position. The position reflects our view that there is still more scope for the NOK to rebound following heavy losses earlier this year compared to CAD. The NOK remains around 7.5% lower against the USD year to date compared to 4.3% for the CAD," MUFJ notes.
"We expected the NOK to benefit going forward from the strengthening recovery Europe, while the CAD could be undermined more by a loss of recovery momentum in the US as restrictions are re-imposed to slow the spread of COVID in southern and western states and the public hold back spending in response to the heightened threat," they add.
