- The US dollar has been back and forth against the Canadian dollar during the trading session on Monday, as we continue to see a lot of questions asked about the 1.38 region.
- This is a market that has a lot of external noise at the moment, mainly due to the fact that the United States and Canada still have no trade agreements going, nor doesn’t look like there’s anything close to progress.
- In other words, this is one of those things that could drag out for a very long time.
Unfortunately for Canada, it’s a bit of a lopsided fight. It is because of this that I think sooner or later the United States dollar will continue to rally against the Canadian dollar, especially if we start to see concerns when it comes to the global, and specifically the American economy. After all, 80% of Canada’s exports end up in the United States and when your biggest customer starts to slow down, it does number on your business. The Canadians are almost wholly dependent on the United States for exports at the moment, and that’s not something that can change overnight. In other words, this is a slow moving train wreck from everything that I can see.
Top Regulated Brokers
Technical Analysis
The technical analysis for this pair is relatively flat at the moment as we are sitting just above the 50 Day EMA, the crucial 1.3750 level, and of course the previous consolidation area where we had formed a massive triple bottom. On the upside, we have the 200 Day EMA at the 1.3878 level, which should come into the picture to offer a bit of resistance. If we were to break above that, then I believe that the United States dollar continues to grind higher against the Canadian dollar.
While the US dollar has been fairly weak against a lot of currencies, the Canadian dollar has been worse. I think that’s what’s going on here, it’s not so much about the greenback, it has a lot more to do with the Loonie and everything surrounding it at the moment. Interest rate differential continues to favor longs in this market.
Ready trade our USD/CAD Forex forecast? Here’s some of the best regulated forex brokers in Canada to check out.