USD/CAD holds the weekly low — so far

Domestic data weighed against trade fears

Trading the Canadian dollar this week is like trying to juggle five balls at once.

1. The NAFTA outlook is suddenly better
2. …but fears of a China-US trade war are higher
3. Oil up 5% on the week, at least partly on Iran-US worries
4. Canadian inflation surprises
5. The Fed sends a dovish signal

That’s a tough equation to solve. You can’t fight domestic data and the potential for higher rates, but would Poloz hike into a trade war? But what if there’s a NAFTA agreement?

Technically, yesterday’s low is the key short-term support level at 1.2819 followed by the March low at 1.2800.

In the longer-term, it looks like a head-and-shoulders top could be shaping up. But it’s early.

I spoke to Reuters about the Canadian dollar yesterday.