USD/CAD Fundamental Analysis: April 17, 2017
The USD/CAD pair has continued to trade within a very limited range of 150-200 pips, which has been the pair’s dominant trend for the past few weeks. The currency pair was unable to make a breakthrough on both sides in spite of the several economic data released which is pushing the currency pair on both sides, proving to be very frustrating for the currency pair’s traders, particularly for those who want to trade with the USD/CAD pair in the long run. Now that the market is entering the latter half of the month, the USD/CAD pair is expected to range and consolidate in the coming weeks.
Last week, the US dollar dropped across the board following comments from Trump concerning the dollar strength as well as the weak interest rates of the nation’s economy. In addition, the BoC has also maintained their current rates and has refused to give out any hints with regards to the central bank’s main course of action. This has then caused the USD/CAD pair to drop down to 1.3300 points and seemed poised to reach 1.3000 points. However, as last week came to a close, the dollar was able to regain its footing, causing it to recover against the Canadian dollar and causing the USD/CAD pair to revert to the 1.3200-1.3400 trading range as it was able to secure a strong profit taking as last week came to a close. In addition, oil prices also surged last week and has managed to settle within $53-$55, ensuring that the USD/.CAD pair remains within its tight trading range.
For this week, the Canadian economy will be releasing its CPI data as well as the unemployment claims data and the oil inventory data from the US economy. These are not expected to bring in additional volatility for the USD/CAD pair and should put the currency pair within its current trend of ranging and consolidation.