CAD: Break of 1.3200-1.3230 could spur a move toward 1.30 - BBH

Research Team at BBH, notes that the Canadian dollar was the best performing major currency last week (+1.7%) after the Norwegian krone (1.8%). 

Key Quotes

“Two fundamental considerations were at work.  First is the 11.6% rally in oil price following OPEC's announcement.  Second is the seven basis point narrowing of the Canadian discount to the US on the two-year money.  The US dollar fell to CAD1.3255 before the weekend, a two-month low.”

“The five and 20-day moving averages crossed for the first time since late October.  Technical factors warn of the risk of additional near-term US dollar losses, though it closed near its lower Bollinger Band (~CAD1.3290).  A break of CAD1.3200-CAD1.3230 could spur a move toward CAD1.30.  The Bank of Canada meets next week, but policy is on steadfastly on hold.”