Canadian Dollar once again surged overnight on positive NAFTA news. And it’s now trading as the strongest one for the week, maintaining gains for the day.
Canadian Foreign Minister Chrystia Freeland said yesterday that “we’re making good progress on NAFTA … having said that, we’re not there yet.” And that’s seen by the markets as positive comments. She will meet with US Trade Representative Robert Lighthizer today.
White House top economic advisor Larry Kudlow also said that there would be “some positive news on NAFTA … and I think the stock market is going to love that.”
It’s also reported that in the latest US proposal regarding car, parts are grouped into five categories. And some of which could have a lower requirement for North American contents or none at all.
It’s been reported repeated that Trump is pushing to have a draft NAFTA agreement by next week. For now, there are so many outstanding issues that it’s impossible to have a full agreement that soon. But there is a chance of a “symbolic agreement” signalling some consensus, as soon as next week.
Technically, the rally in CAD now sent USD/CAD through 38.2% retracement of 1.4689 to 1.2061 at 1.3065. Also, note the head and shoulder top pattern (ls: 1.3000; h: 1.3124; rs: 1.2942) too. It’s now heading to 61.8% retracement at 1.2581 and below.
