USD/CAD Daily Fundamental Forecast – February 12, 2018

The USDCAD pair shot higher during the course of trading on Friday as some weak incoming data from Canada pushed the CAD on the backfoot and this made it easier for the bulls to make use of this opportunity and push the pair higher. The pair tried to break through the 1.27 region but stopped just short of that mark and has since corrected lower back into the 1.26 region. This week should determine the short term direction for the pair.

USDCAD Turns Choppy

It turned out to be an important day for the CAD on Friday as the employment data came in. This missed the expectations by a huge margin and this set the CAD on the backfoot immediately. This helped the pair to move higher  as a combination of CAD weakness and dollar strength helped the pair higher towards the 1.27 region. Addd to this, we saw some weakness in the oil prices as well which pushed the prices below the $60 region leading it to probably the largest corrective phase in its current bull run.

All this led to additional CAD weakness and for a brief while, it looked as though the pair would march towards the 1.28 target. But, the pair met with some resistance at the 1.27 region and this was followed by some weakness in the dollar, which was seen all across the markets. The dollar was pushed on the backfoot on the prospect of another economic shutdown and this has placed the dollar under pressure which has since reversed the entire move higher and now we see the pair trading below the 1.26 region as of this writing.

Looking ahead to the rest of the day, we do not have any major news from the US or Canada for the day and with today being the first day of the week, we are likely to see some slow action in the markets. We could see some ranging on either side of the 1.26 region for the rest of the day.