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USD/CAD Daily Fundamental Forecast – March 19, 2018

The pair trades near Friday lows as CAD remains supported by Friday’s upbeat Canadian GDP data and positive price of crude oil in the global market.

The USDCAD pair continues to trade near the highs of its range and the bulls in the pair should be happy that they have been able to push the pair through 1.30 and hold it above that region. This should give confidence to the other traders that the pair is in a clear bull trend and this should help to further spur the move higher.

USDCAD Continues Above 1.30

The pair has been boosted higher due to the strength in the dollar which has gained over the anticipation regarding the meeting of the Fed later in the week. It is generally expected that the Fed would hike rates during this meeting, for the first time this year and it is also likely that the Fed would accede to the expectations of the market and do that. But what remains to be seen is whether this would indeed be as dollar positive as it is expected to be.

From all accounts, the rate hike has already been priced into the markets and now, it is more a question of what more the Fed can do. The market could be expecting the Fed to spell out their plans for future rate hikes and it is here that the question becomes more subjective on what exactly is likely to impress the markets. With the Fed maintaining that it would wait for the incoming data to decide, we believe that the pressure would be on the dollar to prove itself and this, if it so happens, could put the dollar on the backfoot.

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The oil prices have also been strong and steady and they are likely to lend some support to the CAD in the short term. For today, there is not much of news or data from the US or Canada and so we can safely expect some consolidation and ranging above the 1.30 region.

This article was originally posted on FX Empire

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