USD/CAD Daily Fundamental Forecast – January 8, 2018

The USDCAD continued to crash lower during the course of trading on Friday as the incoming data from the US came in lower than expected while the Canadian data came in stronger than expected and this pushed the USDCAD pair below 1.2400 for a brief while. Though the prices have since recovered and now trade just above the 1.24 region, it is clear that the prices are now under the control of the bears.

USDCAD Crashes Lower

It is going to be a long haul for the bulls in the pair to push the pair through 1.25 anytime soon as the pair is totally under the control of the bears. The dollar bulls are clearly on the backfoot as the data was mixed during the course of last week. The NFP data also came in lesser than expected though the data from the previous month was revised higher and this helped the dollar to survive and hold steady.

The data from Canada has been strong over the last few months and the employment data last Friday continued that trend as it came in much stonger than expected. This was a huge boost for the CAD which pushed against the dollar and this was the main reason for the pair to fall through the 1.24 floor. We believe that the pair is well and truly under the control of the bears and the weakness should only continue and any bounce in this pair should be viewed as an opportunity to sell.

Looking ahead to the rest of the day, we have the business outlook data from Canada but we do not have any major data from the US. Expect some consolidation and ranging to be there for today, as it is the first day of the week and the weakness should continue for the rest of the days of this week.