USD/CAD Daily Fundamental Forecast – July 7, 2017

The USDCAD pair continued to trade in a weak manner though the oil prices moved lower during the last 24 hours and this has weakened the CAD which is the reason why the pair is trading very close to the highs of its range as of this writing. The key to the moves in the short term is likely to emerge later in the day when a slew of data will be out from the US and Canada as well and the market will be watching both sets of data to see how the respective economies are performing.

USDCAD Likely to Remain Under Pressure

The dollar suffered a setback yesterday as the ADP employment data came in weaker than expected. This continued the trend of the economic data from the US which has been weak over the last several weeks. Though the Fed chose to ignore the data and hoped that the data would get better in the coming weeks, the market is still not ready to bite the bullet unless it sees some proof for the same. The dollar bulls had started buying in the hope that the data from this week would get better but the failure of the ADP data would have been a large setback.

Though the dollar did fall against most currencies due to the slip in the data, it managed to hold its own against the CAD and has even managed to stage some kind of a recovery against the currency. The reason could be attributed to the fact that the oil prices have fallen over the last 24 hours and are expected to be weak in the coming days as well. This has kept the CAD soft and this is the reason why the USDCAD pair is trading near its range highs.

Looking ahead to the rest of the day, we have the employment data from the US and Canada later in the day and this should be watched very closely by the investors. Any continued weakness in the US data would not be viewed kindly by the markets and we could witness some large selling in such a situation.