USD/CAD Daily Fundamental Forecast – January 23, 2018

The USDCAD pair continues on its choppy ways, basically falling in line with the expected pattern of ranging and consolidation which it has been undergoing over the last couple of weeks. We expect this to continue for the short term and probably till the end of the month and into the new month when some new set of data is released and that would bring in a lot of volatility in the pair.

USDCAD Still in Range

The pair continues to trade below the 1.25 region and there has not been much happening in this pair. This is in line with what has been happening in the markets in general as well as the pair has been choppy and ranging. There have been no fundamental factors to drive the prices in either direction and that is why we are seeing the price action to be slow and steady. After making a beeline to the lows of the range, we now see the prices moving to the highs of the range.

The dollar has remained steady over the past couple of days and it is expected that it would return to be the center of attraction within the next week or two as we enter a new months and the focus would shift to the Fed and what its timelines for the next rate hike are likely to be. The focus will also be on the incoming data from the US which has not shown the strength that was expected from it and that is the reason why we are seeing it lag behind in the recent period. The dollar bulls would wish for some strong data so that it would further their anticipation for a rate hike in March.

Looking ahead to the rest of the day, we do not have any major data from the US or Canada for the day and so we can expect some more consolidation and ranging.