US trade representative Lighthizer stated yesterday, that “the NAFTA countries are nowhere near close to a deal”. The statement was made as the Senate’s Thursday deadline passed, to present the U.S. lawmakers with a revamped NAFTA deal. On the other hand the Canadian prime minister stated that he had a “positive” feeling about the deal, while a Mexican official noted that a deal might be possible by the end of May. Should there be negative headlines about the NAFTA deal, we could see the CAD and the MXN weakening.
USD/CAD rose yesterday breaking the 1.2800 resistance line. The pair could trade in a rather bullish market today. Such an argument could be supported by possible weak financial data releases for the CAD side and the USD rather strong momentum. Should the bulls continue to be in the driver’s seat we could see the pair breaking the 1.2860 resistance line and aim for the 1.2915 resistance hurdle. Should the bears take over we could see the pair breaking the 1.2800 support line and aim for the 1.2715 support barrier.