Credit Suisse discusses USD/CAD technical outlook and highlights the importance of the 1.2608 level for near-term directional bias.
"The market could still be forming a smaller base, which would be confirmed with a break above the 200 -day average at 1.2569 /2608. With the market also maintaining a much larger multi -month base, this would confirm that the uptrend is resuming for a move back to the 1.2807 high, with next resistance at the highs for the year at 1.2870/81. The “measured base objective” still projects a move to 1.3024, where we would look for a firmer ceiling," CS notes.
"Near -term support stays at 1.2489/74, below which would negate the smaller basing potential and trigger a retest of 1.2429/08, but with buyers still expected to show here. Below 1.2408 would negate the larger base to turn us tactically neutral, however we view this as an unlikely scenario," CS adds.