USD/CAD extend gains on NAFTA talks and stronger US dollar

• USD/CAD prints 1-week highs above 1.3050 and turns positive for the week. 
• NAFTA talks: Canada warns that deal is not there yet. 

The USD/CAD pair broke to the upside and reached a fresh weekly high at 1.3087. Price was holding near the highs, with a bullish tone, consolidating important daily gains. From the weekly low the pair rose almost 200 pips. 

The move to the upside followed comments from Canadian negotiator Freeland who said “we’re not there yet” regarding the trade deal with the US and Mexico. PM Trudeau added that a “no deal” on NAFTA was better than a bad one. Also, the pair moved higher on the back of a stronger US dollar. The greenback gained momentum amid risk aversion and rose particularly against the euro and the Australian dollar.  

Technical levels 

USD/CAD broke key short-term resistance levels during the last two days and climbed back above the 20 and 100-day moving average. Now it appears to head for a test of 1.3100, above the next key level to watch it seen around 1.3110/20, a downtrend line from June highs. On the flip side, support might now be located at 1.3040 (20-day moving average), 1.3010 and 1.2960.