Mexican economy minister Guajardo said that a meeting on Thursday could take place to discuss NAFTA. Though no final decisions are to be met, some progress could be announced at a number of issues. The meeting is to serve more as a starting point for further negotiations. Should there be further positive headlines for NAFTA there could be some turbulence for CAD, right after the BoC decision.
USD/CAD has been trading in a sideways manner for the past week, constantly testing the 1.2610 resistance line. We see the case for the pair to continue to trade in the same manner as the market will start slowly positioning itself ahead of the BoC interest rate decision. Should the bears take over the pairs’ direction we could see it aiming for the 1.2485 support line. Should the bulls take the driver’s seat we could see the pair breaking the 1.2610 resistance line and aim for the 1.2715 resistance barrier.