USD/CAD Daily Fundamental Forecast – August 24, 2017

The USDCAD pair continued its down trend as the strong oil prices tended to lend some support to the CAD and this has since pushed the USDCAD pair towards the 1.25 region where it is likely to see some support atleast for today as the markets wait for the updates from the meeting at Jackson Hole.

USDCAD Continues Downtrend

This meeting has been the focus of all attention for the whole of this week and hence the outcome of this meeting is likely to be bring in a lot of volatility. It is unlikely that the dollar would be affected too much by this meeting though the Fed Chief Yellen is scheduled to make a speech late in the day tomorrow as she is not expected to touch much upon the monetary or the economy policy of the US.

But as we have been saying for many days now, the USDCAD pair is clearly in a downtrend and the traders should be using every bounce as an opportunity to go short on this pair whenever it is possible for them. The traders did get an opportunity to do exactly that when the pair bounced towards the 1.2750 region on the back of some strength in the dollar and the weakness in the oil prices. But since that time, the oil prices have been moving higher and the incoming data from Canada has been showing a lot of strength in the economy which should encourage the BOC to hike rates further.

Looking ahead to the rest of the day, we do not have any major news from Canada and expect the weakness and the pressure to continue on this pair for today which would carry it to the 1.25 region and there, the pair is likely to wait for the outcome of the meeting.