Progress for NAFTA

Canadian foreign minister stated that there was good progress on NAFTA key issues. The progress seems to be related to the issue of car making and what constitutes an American car. All sides seem to push for a new NAFTA agreement before July 1st in order to avoid clashing with Mexican elections, and time frames such as mid to end May for an acceptable agreement could be feasible. Any further positive headlines regarding NAFTA could support CAD.

USD/CAD traded in a sideways manner yesterday, breaking the 1.2610 support line twice in the 4 hour chart. We see the case for the pair to drop somewhat today as the financial data due out later on could favor the CAD side. Should the pair come under selling interest it could break the 1.2610 support level again and aim for the 1.2485 support barrier. Should it find fresh buying orders along its path we could see it breaking the 1.2715 resistance level and aim for the 1.2800 resistance zone.