The USDCAD pair had a bit of a choppy week as the pair traded on either side of 1.35 without giving out any signs on which way it wanted to go. There was a good battle between the bulls and the bears through the day and this was something that was expected as we had mentioned in our forecasts that the region around 1.25 would be important to determine the next direction for this pair.
USDCAD Turns Choppy
There was quite a bit of data from both the US and Canada over the last week and this helped to bring in a lot of action in this pair though the end result was that the pair ended the week just above 1.25 without any specific direction. The US was buoyed by some good data in the form of ADP employment report, the PMI report and the wages report during the course of the week. On the other hand, the dollar suffered due to a very bad NFP report which came in negative though the data from the previous month was revised higher. Overall the data from the US was choppy and this was reflected in the price action of the dollar as well.
On the same note, Canada also had some choppy data as the trade balance data came in slightly weaker than expected. Though it was only slightly weak, this was the first piece of data after the rate hike from the BOC and the weakness caused worry on whether this pointed to some prolonged trend. This notion was dispelled when the employment report came in stronger than expected. The oil prices were also choppy during the course of the week and this led to some overall choppiness in the CAD as well.
Looking ahead to the coming week, we do not have any major news from Canada but we have the FOMC minutes, the CPI and Retail sales data from the US. With the Fed keeping the door open for a rate hike in December, the market would be watching the minutes very closely for any signs or confirmation of the same. If the minutes or the data is hawkish, then we can expect a round of dollar buying which would help this pair to break free of the 1.25 region and head towards 1.28.
This article was originally posted on FX Empire
More From FXEMPIRE:
- Oil Price Fundamental Daily Forecast- Prices Could Jump if Trump Decertifies Iran Deal
- DAX Index Fundamental Analysis – week of October 9, 2017
- FTSE 100 Index forecast for the week of October 9, 2017, Technical Analysis
- USD/CAD Fundamental Analysis – week of October 9, 2017
- Major US Indices, Forecast for The Week of October 9, 2017, Technical Analysis
- Crude Oil forecast for the week of October 9, 2017, Technical Analysis