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.
During today’s European morning we get Germany’s Industrial Orders for February, Eurozone’s Final Services PMI for March, Final Composite PMI for March, Retail Sales growth rate for February and UK’s Markit/CIPS Services PMI for March.
In the North-American session we get from the US the Trade Balance Deficit for February and from Canada also the Trade Balance Deficit for February.
Canadian Foreign minister stated yesterday that good progress was made on the NAFTA trade pact but still have work to do. The three countries could announce by mid-April the outlines of a settlement on the key issues of auto content. Media reports state that Trump’s top economic adviser Kudlow, predicted yesterday that there would be some positive news on NAFTA and that the stock-market would love them. Overall, should there be any further positive headlines about NAFTA we could see the CAD strengthening.
USD/CAD traded in a roller coaster mood yesterday and during today’s Asian morning, breaking the 1.2800 resistance line twice, marking the lowest rates for the past two months. Should there be further positive headlines for a possible NAFTA agreement we could see the pair trading in a bearish mood. Should the pair find buying orders along its path we could see it breaking the 1.2800 resistance line and aiming for the 1.2910 resistance hurdle. Should it continue to be under selling interest we could see it breaking the 1.2715 support line and aiming for the 1.2610 support level.