Yahoo Finance USD/CAD Daily Price Forecast – USD/CAD Continues Range Bound Action Amid Lack of Macro Data Updates
USDCAD pair traded in a tight range yesterday as both Canada and United States markets were closed owing to the celebration of the national holiday. This resulted in price action being limited within a range of 20 pips. On Friday, the pair saw price move in favor of Canadian Loonie as the crude oil price has been recovering in broad market. Further, disappointing macro data outcome, dovish fed stance on rate hike plans for 2019 and US President Donald Trump’s declaration of national emergency all added dovish pressure to US Dollar in the broad market. However, optimism surrounding Sino-U.S. trade talks helped USD recover some ground in the global market despite dovish cues from the U.S.A.
Crude Oil Price Continues To Underpin Loonie Bulls
Crude oil traded positive in the broad market and this underpinned CAD bulls preventing Dollar from gaining a strong upside move. News that tension was escalating between Russia and OPEC due to Russian crude production activity seeing little reduction and argument between Energy ministers of both nation lead to speculation that Russia may drop out of OPEC group’s production and supply cut agreement. This caused crude oil price to suffer a little and resulted in CAD weakening for short while causing USD to hit an intra-day high of 1.3272 well above the mid-1.32 handle. However, optimism surrounding Sino-U.S. trade talks set to occur in Washington today along with production and supply cut in crude oil market helped crude oil price remain positive.
This helped Canadian Dollar recover momentum and drag price action below mid-1.32 handle as CAD bulls regained strength owing to the strong crude oil price in the broad market. Being a commodity-linked currency, Canadian Loonie trades positive as long as crude oil price remains high in the broad market. As of writing this article, the pair is trading at 1.3253 up by 0.10% on the day. There are no macro data updates scheduled on either side of the pair leaving price action in the mercy of news driven momentum and broad-based strength of USD. When looking from the technical perspective, the pair lacks directional bias and is likely to trade range bound for rest of the day. Expected support and resistance for the pair are at 1.3225, 1.3210 and 1.3270, 1.3300 respectively.
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This article was originally posted on FX Empire
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