USD/CAD: Losses to extend meaningfully on a break below 1.3535 – Scotiabank

USD/CAD has eased modestly. A break under the 1.3535 is required to trigger additional losses, economists at Scotiabank report.

CAD shows signs of decoupling from stocks

“CAD’s correlation with equities is weakening and currently stands just below 60%, the weakest since last Jul. If the CAD is decoupling from equity trends, other (typical) fundamental drivers are not obviously supportive.”

“USD/CAD losses would need to extend through the mid-1.35s and below 1.3535 (Monday’s low and potential double top trigger) to extend meaningfully.”

“Solid resistance remains at 1.3665 (the potential double top).”