USD/CAD closed the week at 1.3649, just above support at 1.3648 (discussed last week). USD/CAD opened the week at 1.3642 and climbed to a high of 1.3794. USD/CAD starts the week just above support at 1.3648. The US economy remains strong, despite a disappointing Q1, and weak oil prices are weighing on the Canadian dollar. I am bullish on USD/CADThe Fed statement was more hawkish than expected, increasing the likelihood of a June rate hike.
referring to
USD/CAD Daily Fundamental Forecast - May 09, 2017
USDCAD In Consolidation PhaseThe recovery in the prices of this pair has been brought about by the continued weakness in the oil prices that we have been seeing. The pair has corrected since late in the day and now trades below the 1.37 region as of this writing. The CAD has been further weakened by the continued jawboning of Trump and his team over wholesale changes to the NAFTA agreement and against the Canadian economy as such. Already, their housing sector is under a lot of duress and this is seen in their incoming data and all these pressures have begun to build on the CAD over the last few weeks. Looking ahead to the rest of the day, we do not have any major news from Canada or the US for the rest of the day and so we can safely expect some consolidation and ranging on either side of 1.37 during the day.
The USD/CAD pair rallied significantly during the day on Monday, as oil markets fell apart. However, I would look for the oil market to continue falling to take advantage of a move to the upside in this market. Crude oil levels to watchThe crude oil markets breaking below the $45 level would be very negative, and should send this market to the upside from here. I believe that we could get a bit of a pullback from here, but longer-term I think that the oil markets will fall apart and offer a buying opportunity. If we can break above the top of the daily range, I think the market will then go towards the 1.3775 level.
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