USD/CAD Daily Fundamental Forecast – November 28, 2016

USDCAD continues to remain unfazed as it continues to consolidate and range on either side of 1.3500 irrespective of whether the USD is strong or weak and that is what we have been seeing over the past week or so. The USD strength seen over the past couple of weeks did not seem to affect the pair much and the USD weakness seen so far today also does not seem to have affected this pair.

This pair, at the moment, seems to have a nice combination of currencies who strengths and weaknesses seem to cancel out each other quite effectively over the last few weeks. Whenever we saw USD strength, we saw strength in the oil prices as well which kept the CAD strong as well and this helped to counter act the dollar strength. Today morning, we have been seeing some meaningful USD weakness after 2-3 weeks and what we have also been seeing is a dip in oil prices due to confusion among the oil producers in agreeing to a deal and this has in turn caused the CAD to be weak as well. So what we have finally got is ranging and consolidation as the currencies cancel out each other and the traders do not seem to know which way to invest. But the fact that the pair has not moved either way too much too soon suggests that the trend is still intact and that trend is still up. We continue to believe that the USDCAD pair will continue to move higher in the medium term though it seems to be taking an awfully long time going about it. We continue to look forward to a target of 1.400 in the pair though the time that it takes to get there might make it a little less worthwhile.

Looking ahead to today, we do not have much of news from the US or the Canadian region and so expect some more consolidation for the rest of the day.