1.20 rejected today
USD/CAD is back to flat on the day at 1.2060. It had hit a the lowest since April 2015 at 1.2005 but couldn't break through the big figure.
You can look at it two ways:
1) The Canadian dollar doesn't believe in the break higher in oil.
2) The 1.20 is a tough nut to crack and it wasn't the right day to take it out. The US dollar is holding its ground today and the loonie is overbought so it will need a big push. Risk appetite has also reversed. Finally, commodities prices have come off the highs
I come down in the second camp. A level like 1.20 is big, especially given that it so closely coincides with the 2017 lows.
I think if that level goes, it has to signal a sustained boom coming out of the pandemic. The targets are 1.1250 and below. That's a lot to stomach right now given that there is so much uncertainty.
