Listen to the latest market mood for the USDCAD pair.
Weak USD, Strong CAD
The outlook for the USD remains weak. Positive risk sentiment is causing the USD to weaken. As a safe haven currency during the COVID-19 crisis, the USD is weakening on global vaccine hopes. Month-end rebalancing favours dollar sellers. However, there is a risk that further US-China tensions cause dollar strength.
The outlook for the CAD remains strong as oil prices have been supported on supply cut hopes and positive risk sentiment has been underpinning prices on vaccine hopes. Therefore, as long as US-China tensions don’t emerge we can expect USDCAD sellers today on retracements.
Technically USDCAD has broken a triple bottom on the daily chart. Any retracement to that broken support level at 1.3847 can be considered suitable for shorts today.
We expect this outlook to play out over the next 6-8 hours.
- Any negative news for the COVID19 outbreak would result in USD strength and invalidate this outlook.
- Any further negative US-China trade disputes news could invalidate this outlook and weaken the CAD and strength.