USD/CAD Daily Price Forecast – Range Bound Action To Continue Amid Lack of Breakout Trigger

USDCAD pair traded range bound today as both sides lacked strength and decisive updates that could help create a breakout. Given the fact that Crude oil has been trading positive for the last four consecutive trading sessions, Canadian Dollar has managed to hold itself against US Greenback pretty well. Weakness surrounding US Dollar following disappointing macro data updates from earlier in the week also helped see positive price activity. Canadian Dollar being a commodity-linked currency shows positive price action whenever Crude oil trade positive in the broad market. Sentiment surrounding the Crude oil market is bullish off late and this has helped underpin demand for CAD to some extent.

OPEC’s Production & Supply Reduction Helped Boost Crude Oil Price

Crude oil price remained well above $54 per barrel and futures market saw price hit new 2019 highs. Brent futures saw price break past $65 per barrel for the first time this year despite activity above said level lasting only for short while. OPEC led production and supply cut enforcement is beginning to have a visible impact on crude oil market as aside from the USA, according to macro data updates inventory data from OPEC nations continue to show a draw following implementation of production cuts. Further, U.S. sanctions on crude oil export from Venezuela and Iran created disruption in global supply and this has led to the current scenario where crude oil trades positive for consecutive trading sessions.

As of writing this article, USDCAD pair is trading at 1.3278 down by 0.14% on the day. On the release front today, both Canadian and US macro calendars saw worse than expected readings but failed to have any major impact on price action as geopolitical events have greater sway and control over today’s price action. The pair is expected to trade range bound for rest of the day as it lacks clear directional bias on either side of the pair. Moving forward, the pair faces strong resistance at 1.3294/95 to the upside followed by 1.3312 & 1.3339 handles which have to be breached for USD to regain control over price action while the downside sees support near 1.3265/63 handle followed by 1.3255 &  1.3215 which needs to be breached for CAD to regain control over price momentum.

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