USD/CAD Price Forecast – US dollar pulls back against Loonie

The US dollar continues to grind against the Canadian dollar to the upside, banging up against resistance along the way. The 1.3050 level has been very stringent as of late, and I think eventually the one thing that could, this is a move to the 1.32 level. It is going to be very noisy though, and that’s not necessarily out of the norm for this pair, especially during the summer months as Americans drive more, burning more petroleum, driving up the value of the Canadian dollar, or at the leased stabilizing it as we see right now.

Longer-term, I do think that we go higher based upon interest rate differential and of course fears of a trade spat between the two allies. At that point, you should bet on the Americans, as the signs of the economy in the United States dwarfs that of Canada. Longer-term, I think we will probably go looking towards 1.35 handle, but it is going to take a lot of work to get there. If we were to break down below the 1.29 level, that would be very negative as it would not only fill the gap completely from the open this week, but it would also breakthrough that bit of support which is almost always a massively negative sign. Pay attention to the crude oil market, it will certainly have its bearing on this pair.