USD/CAD Daily Fundamental Forecast – April 24, 2017

USDCAD tried to make its way through the 1.35 region on Friday but was largely unsuccessful. This rise was due to the fall in the oil prices which broke through the important support region at around the $50-$50.5 mark and this was enough to weaken the CAD which depends on the oil prices a great deal. Hence, we saw the USDCAD pair push through the 1.35 region and it did make its way towards the 1.3530 region before the dollar weakness set in and the pair retreated back towards 1.35.

USDCAD Weakens On Dollar Weakness

As of today morning, we are seeing a risk on mode in the markets in general and we have seen the euro skyrocket as the French elections got over and done with as Macron won the elections as expected. This risk on mode has led to a slight weakness in the dollar that is seen across the markets and this has pushed the USDCAD pair below 1.3450 as of this writing.

The pair is likely to consolidate and range in the short term but with the oil price breaking below an important support region, we expect the CAD to trade in a weak manner in the short term. So, we expect the USDCAD pair to continue to keep pushing at the highs of the range to see whether all the sells can be slowly dried up and if and when that happens, we could see the pair move higher. But with the pair having broken down on previous approaches to this region, any break higher would require a lot of effort from the bulls with the help of some fundamental changes.

Looking ahead to the rest of the day, we do not have any major economic news from the UK or Canada for the day and so we expect some more consolidation and ranging with a bullish bias in this pair.