USD/CAD Update:Bearish Rally Resumes Amidst Global Uncertainties

9. Jan.

USD/CAD Update: Bearish Rally Resumes Amidst Global Uncertainties

The USD/CAD pair showcased a rebound around the 1.3400 area, aligning with the earlier forecast that anticipated a retracement to the 50% Fibonacci level. However, the prevailing bearish downtrend suggests that the pair may be gearing up for another leg of its bearish journey, poised for a renewed pushdown.

Crude Oil and Geopolitical Influences:

In the commodities arena, the West Texas Intermediate (WTI) price hovers around $71.00 per barrel against the backdrop of geopolitical uncertainties. Sideways movement in crude oil prices reflects concerns over the potential escalation of the Israel-Gaza conflict into a broader regional crisis. US Secretary of State Antony Blinken's visit to Tel Aviv for discussions with Arab leaders adds an element of geopolitical intrigue, contributing to the cautious sentiment in oil markets.

Canadian Economic Indicators:

Turning our attention to the Canadian economic landscape, upcoming releases of the International Merchandise Trade Balance and Building Permits on Tuesday are poised to offer insights into the nation's economic performance. Forecasts indicate a potential decline in the Canadian International Merchandise Trade Balance from 2.97 billion to 2.0 billion for November, signaling a shift in the imports and exports of Canadian goods.

Additionally, a projected decrease in Canadian Building Permits for November from 2.3% to 2.0% suggests a potential moderation in construction activities. The construction data's significance lies in its reflection of broader trends in the real estate and housing sectors, influencing corporate investments and introducing an element of volatility to the Canadian Dollar (CAD).

Forecast and Market Bias:

Maintaining an unchanged forecast, our bias leans toward an anticipated pushdown by the USD/CAD pair, potentially forming new lower lows. The interplay of geopolitical factors, economic indicators, and the prevailing bearish trend sets the stage for an intriguing period in the dynamics of the USD/CAD pair, with traders and investors closely monitoring the unfolding events.

Yesterday's Forecast:



TODAY:



Our preference

Short positions below 1.3530 with targets at 1.3300 & 1.3200 in extension.