USDCAD continues to consolidate and range and wait for the next direction. We have been mentioning in our last few forecasts that the pair has been struggling to gain any kind of traction in either direction and this is what we have been seeing over the last few days. Periods of dollar strength lead to a slight bounce while periods of dollar weakness lead to a slight correction but there is nothing in play for the bulls or the bears to seize control and the pair seems to be trading in a kind of a stalemate between them.
Yesterday, we continued to see some good economic data from the US but that was not enough for the bulls in the pair to push the USDCAD upwards. It still continued to struggle to break through 1.3100 and it is back trading near 1.0360 which was exactly the same place that it was in at this time yesterday as well. So, not much has changed and it remains to be seen what will cause any major movement in this pair. As we have been saying repeatedly, a break below the support region at around 1.3000 would signify a massive change of trend and this is what the bulls are trying to protect at all costs. But the data and the fundamentals are not helping the US dollar to push through higher and this is causing the bulls to struggle to string together a few days of bullishness which will help to build the momentum in this pair. This lack of momentum is what is causing this ranging and consolidation.
Looking ahead to today, we do not have any major news from the US or Canadian regions and we also have a long weekend coming up in the US and so there may be some squaring off of positons ahead of the weekend. But we do not think these are going to cause any major moves in this pair and we are likely to see some more consolidation between 1.3000 and 1.3100 for the rest of the day.