- You can see that in the early hours of Tuesday morning we continued with some negativity against the US dollar against the Canadian dollar, but we have turned around quite a bit and are showing signs of resilience.
- This shouldn’t be a huge reward considering the market is in a strong uptrend, and there seems to be nothing but chaos in Ottawa.
- Americans are coming to the presidency of Donald Trump, who will be very pro-business. Canadians have a parliament on hold until sometime in March while the Liberal Party tries to get it together, only to lose to the Conservatives in the role of prime minister and possibly the entire parliament. Canada will sooner or later be the place you want to invest.
But right now, it still looks very high in the air. And as long as that is the case, the Canadian dollar will be a little softer. The rise in oil doesn’t seem to be helping much. It makes sense in this USD/CAD pair at least due to the fact that the Americans are producing more than enough of their own oil at the moment. But the increase in demand probably makes the Canadian dollar a little more attractive compared to other currencies like the Japanese yen, for example.
1.45 It will still matter
The 1.45 level above is still a significant psychological barrier that I think will be difficult to go above and truly break, but that’s what we’re aiming for. Below we have the 1.42 level offering support, so that comes into play as well. Note that Friday has employment numbers from both the US and Canada, so this could be a very volatile pair at the end of the week. Right now, though, it looks like it’s trying to move on. That’s somewhat of a positive momentum over the last two weeks as we face this big ceiling.
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