The 16 March USDCAD Weekly Outlook reports that the pair has steamed to a nine-month high at 1.3072, extending the run higher from sub-1.2250 levels that were seen in early February. What else is presented in this report?
16 March, HotForex – The Canadian dollar has been underperforming amid worries about the NAFTA negotiation and after BoC Governor Poloz said on Tuesday that the unwinding of monetary stimulus would “remain cautious.”
Tariff and NAFTA concerns
Tariff and NAFTA worries remained palpable and contributed to some risk-off flows, while the double blow of a miss in Canadian exiting sales yesterday along with Trump tweeting out — Canada’s trade surplus with the U.S, is the reason for CAD’s sharp weakness.
Meanwhile, yesterday the Mexico economy minister Guajardo stated that Mexico and Canada can make a deal on NAFTA without the U.S., which must decide if it’s in or out. That doesn’t sound like negotiations are going very well, though Trump tweeted that the U.S. continues to negotiate with Canada on the trade surplus.
Both the CAD and MXP continue to be weakened so far today. The trade cudgel continues to be welded by Trump, keeping the NAFTA markets nervous. It remains to be seen if NEC director nominee Kudlow can help manage the fraught process.
Loonie remains in an uptrend
Oil prices have also been trading on the softer side, while we anticipate that Canadian Dollar will continue weakening, with next resistances coming at 1.3080, 1.3140 and 1.3200. A consolidation above 1.3030 is likely to be seen today, before another attempt higher.
Technically Loonie remains in an uptrend, which has been in play since late January. It managed to break December’s Fractal high, and the 20-Months Moving average. Hence, it is currently moving above all 3 MAs. Trend support comes in at 1.2975.
16 March USDCAD Weekly Outlook – Steamed To A 9-Month High?
Nevertheless, Weekly and Daily Momentum Indicators indicating that there is further space upwards, with RSI pointing upwards at 62, and Stochastic crossing into overbought Territory but still at 76. The MACD lines just turned positive in Weekly basis, while in the Daily fluctuating above neutral, suggesting Strong positive momentum.
In Short-term, a break today above latest high at 1.3070, could trigger a long position with the target at the immediate resistance level at 1.3797, with support at 1.3055.
This article about 16 March USDCAD Weekly Outlook was written by Andria Pichidi, Market Analyst at HotForex. The provided article is a general marketing communication for information purposes only. It does not constitute an independent investment research. Nothing in this communication contains an investment advice or an investment recommendation. It also does not contain a solicitation for the purpose of buying or selling of any financial instrument.
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