USD/CAD Daily Price Forecast – USD/CAD Turns Range Bound as Greenback Lacks Strength to Breakthrough

The USD/CAD pair caught some fresh bids at the start of a new trading week and recovered a part of Friday’s slide to over one-week lows. With investors still assessing Friday’s dovish comments by the Fed Vice Chairman Richard Clarida, saying that interest rates are nearing a neutral rate, a modest US Dollar rebound was seen as one of the key factors behind the pair’s modest rebound on Monday. Given Friday’s resilience to breakthrough over one-month-old ascending trend-channel support, today’s upward price action could further be attributed to some short-covering move. As of writing this article, the USD/CAD pair is trading at 1.3162 up by 0.11% on the day.

Crude Oil Price Dynamics To Dictate Price Momentum Today

The uptick however seemed lacking conviction amid a strong follow-through upsurge in crude oil prices, which underpinned demand for the commodity linked currency – Loonie and is expected to keep a lid on any meaningful up-move during today’s market hours. In fact, WTI crude oil built on last week’s goodish rebound and got an additional boost after de-facto OPEC leader Saudi Arabia was said to push OPEC and its allies to cut output in December from 1 million to 1.4 million barrels per day to counter a slowdown in global demand. In absence of any major market moving economic releases from both US and Canadian calendar, the pair remains at the mercy of broader market sentiment surrounding the greenback and oil price dynamics.

When looking at the pair from technical perspective, any meaningful up-move is likely to confront some fresh supply near the 1.3200 handle, above which the pair is likely to aim back towards challenging the 1.3250-60 supply zone before eventually darting towards the 1.3300 round figure mark. On the flip side, the 1.3130-25 zone now seems to have emerged as an immediate support, which if broken might drag the pair below the 1.3100 mark towards testing 50-day SMA support, currently near the 1.3045 region. Expected support and resistance for the pair are at 1.3144, 1.3122, 1.3111 and 1.3180, 1.3202, 1.3220 respectively.