For the fourth day in a row, the USD/CAD is attracting sellers and appears to be at risk of further decline.
The Loonie is supported by rising crude oil prices and fewer wagers on a rate decrease by the Bank of Canada.
The USD and the currency pair are impacted by dovish Fed expectations and US fiscal concerns.
The USD/CAD pair trades negatively on Thursday for the fourth day in a row as it fails to build on the overnight recovery from the 1.3815–1.3810 range, or a two-week low. During the Asian session, spot prices hover around the mid-1.3800s and appear susceptible to prolonging the weekly downward trend.
Following the previous day's decline from a peak of over one month due to the uncertainty surrounding US-Iran nuclear talks, crude oil prices have resumed their upward trajectory. Furthermore, the commodity-linked Loonie is thought to be supported by the Bank of Canada (BoC) cutting interest rates in June, but this was muted by hotter-than-expected Canadian core inflation data reported on Tuesday. This puts some downward pressure on the USD/CAD pair, as does the common selling bias in the US dollar (USD).
Following Moody's reduction of the US sovereign credit rating and growing concerns over the US deficit following US President Donald Trump's massive tax plan, investors are still on edge. Additionally, the USD remains weak near a two-week low due to resurgent US-China trade tensions and wagers that the Fed will reduce borrowing costs in 2025. This confirms the short-term pessimistic picture and adds to the offered tone surrounding the USD/CAD pair.
Technically speaking, bearish traders are favored by the recent failure close to the crucial 200-day Simple Moving Average (SMA) and the subsequent breach below the 1.3900 level, which is the lower limit of a short-term trading range. Consequently, this implies that the USD/CAD pair's path of least resistance is still downward. For short-term opportunities, traders now anticipate the release of the US macro data and flash global PMIs.
The Loonie is supported by rising crude oil prices and fewer wagers on a rate decrease by the Bank of Canada.
The USD and the currency pair are impacted by dovish Fed expectations and US fiscal concerns.
The USD/CAD pair trades negatively on Thursday for the fourth day in a row as it fails to build on the overnight recovery from the 1.3815–1.3810 range, or a two-week low. During the Asian session, spot prices hover around the mid-1.3800s and appear susceptible to prolonging the weekly downward trend.
Following the previous day's decline from a peak of over one month due to the uncertainty surrounding US-Iran nuclear talks, crude oil prices have resumed their upward trajectory. Furthermore, the commodity-linked Loonie is thought to be supported by the Bank of Canada (BoC) cutting interest rates in June, but this was muted by hotter-than-expected Canadian core inflation data reported on Tuesday. This puts some downward pressure on the USD/CAD pair, as does the common selling bias in the US dollar (USD).
Following Moody's reduction of the US sovereign credit rating and growing concerns over the US deficit following US President Donald Trump's massive tax plan, investors are still on edge. Additionally, the USD remains weak near a two-week low due to resurgent US-China trade tensions and wagers that the Fed will reduce borrowing costs in 2025. This confirms the short-term pessimistic picture and adds to the offered tone surrounding the USD/CAD pair.
Technically speaking, bearish traders are favored by the recent failure close to the crucial 200-day Simple Moving Average (SMA) and the subsequent breach below the 1.3900 level, which is the lower limit of a short-term trading range. Consequently, this implies that the USD/CAD pair's path of least resistance is still downward. For short-term opportunities, traders now anticipate the release of the US macro data and flash global PMIs.
