USD/CAD - Focus on the USD side of the equation - Morgan Stanley

Analysts at Morgan Stanley are out with their strategy for trading USD/CAD pair in the next three months.

Key Quotes:

“USDCAD is an expression of the USD view and less about the CAD side. 

Assuming that the broad USD index starts falling from now, 2-3-month at-the-money USDCAD puts … become a cheap way to play for the weaker broad USD, with positive P&L if USDCAD is below 1.3150 and 1.3110 in two and three months, respectively.”