Fundamental Overview:
The USD/CAD currency pair experienced a sharp surge, reaching its highest level since April 2003, trading around 1.4710. This movement was triggered by recent trade policy announcements and economic data affecting both the U.S. and Canadian economies.
Trade Tariff Announcement:
U.S. President Donald Trump imposed a 25% import tariff on Canadian goods and a 10% tariff on Canadian energy exports. These protectionist measures have heightened trade tensions and weakened the Canadian dollar.
Economic Data:
Canadian GDP showed a 0.2% decline in November 2024, with a preliminary estimate of a 0.2% rebound in December 2024. The mixed data has failed to instill confidence in the Canadian dollar, keeping downward pressure on it.
Treasury Yield Impact:
U.S. Treasury yields remain elevated as investors move their funds to safer assets, further boosting demand for the U.S. dollar.
The combination of trade uncertainty, weak Canadian economic data, and robust demand for U.S. assets continues to fuel USD/CAD bullish momentum.
Technical Outlook:
On the technical front, USD/CAD bulls remain firmly in control as the pair trades near the critical psychological level of 1.4700.
Resistance Levels:
Immediate resistance is seen at 1.4750. A break above this level could pave the way for further gains, targeting 1.4800 in the near term.
Support Levels:
On the downside, initial support is at 1.4630, followed by the pivotal 1.4500 level. A breach below this zone could trigger a correction toward 1.4430, which aligns with the daily 72 EMA.
The USD/CAD currency pair experienced a sharp surge, reaching its highest level since April 2003, trading around 1.4710. This movement was triggered by recent trade policy announcements and economic data affecting both the U.S. and Canadian economies.
Trade Tariff Announcement:
U.S. President Donald Trump imposed a 25% import tariff on Canadian goods and a 10% tariff on Canadian energy exports. These protectionist measures have heightened trade tensions and weakened the Canadian dollar.
Economic Data:
Canadian GDP showed a 0.2% decline in November 2024, with a preliminary estimate of a 0.2% rebound in December 2024. The mixed data has failed to instill confidence in the Canadian dollar, keeping downward pressure on it.
Treasury Yield Impact:
U.S. Treasury yields remain elevated as investors move their funds to safer assets, further boosting demand for the U.S. dollar.
The combination of trade uncertainty, weak Canadian economic data, and robust demand for U.S. assets continues to fuel USD/CAD bullish momentum.
Technical Outlook:
On the technical front, USD/CAD bulls remain firmly in control as the pair trades near the critical psychological level of 1.4700.
Resistance Levels:
Immediate resistance is seen at 1.4750. A break above this level could pave the way for further gains, targeting 1.4800 in the near term.
Support Levels:
On the downside, initial support is at 1.4630, followed by the pivotal 1.4500 level. A breach below this zone could trigger a correction toward 1.4430, which aligns with the daily 72 EMA.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.