USD/CAD Daily Price Forecast – The Loonie Pair Sets On Pullback With Crude Price Soar

The Loonie pair followed a mixed movement in the morning session. The USD/CAD touched both the day’s low of 1.3380 level and the day’s high of 1.3409 level. The US Treasury bond rebounded yields from 15-month lows. This favored the USD/CAD pair to start off the day skyrocketing from its lower vicinity.

The loonie pair, however, plunged laterwards when the crude prices took a pick up. The oil prices rose more than 1 percent with the OPEC supply cuts and lower expectations of the U.S. inventories entailed with weaker demand due to the global economic slowdown.

The crude price upliftment directly elevated the commodity-linked currency- Canadian Dollars. “As long as OPEC’s output remains depressed and global oil demand and oil demand growth stay around the current level, money managers will likely keep investing in oil, thus supporting the price,” says Tamas Varga of PVM Oil Associates.

February US Housing Starts (MoM) and Building Permits (MoM) both reported numbers lower than the consensus estimate.

At the time of writing this article (13:38 GMT), the USD/CAD was trading at around 1.3393 level.

Today, by 14:00 GMT, the US Conference Board will release the Consumer Confidence Index which measures the level of confidence the individuals have on the national economic activity. The release of this event can have a mediocre level of impact on the USD Index and thereby on the loonie pair.

Recession fears seemed to lower today. On Friday, the Canadian bonds joined the negative yield curve with its US counterpart which signaled the risks of a recession. The Bank of Canada had then announced that it would freeze rates until the last month of 2019. There still remains some recession fears left in place as new updates arrive in the coming days.

Technical Overview

The USD/CAD was trading above the Exponential Moving Average (EMA) showing signs of a bearish stance. The pair is seen to be weighing more to the lower area between the middle band and the lower bound of the Keltner Channel (KC). The loonie pair clearly shows signals for a possible pullback from the day’s high.