Canadian Prime Minister Justin Trudeau stated yesterday that NAFTA negotiations are moving forward in a significant way. The statement came after US officials made a number of optimistic comments about a preliminary deal on NAFTA. Furthermore, Mexican officials stated that with enough progress, the leaders of the three countries could make an announcement at a regional summit in Peru next week. Should there be further positive headlines for a deal in NAFTA we could see the CAD strengthening albeit yesterday’s comments did not seem to have a significant impact on USD/CAD.
USD/CAD traded in a sideways manner yesterday, testing the 1.2715 resistance line. We see the case for the pair to continue to trade in that manner however the pair may be heavily influenced by the release of the US and the Canadian Employment data later on today. Should the bulls take the driver’s seat we could see the pair breaking the 1.2800 resistance level and aim for the 1.2910 resistance hurdle. Should the bears have the upper hand we could see the pair trading south breaking the 1.2715 support line and aim for the 1.2610 support barrier.