USD/CAD has posted small gains on Tuesday, continuing the upward trend which marked the Monday session. Currently, the pair is trading at the 1.34 level. On the release front, it’s another quiet day. In the US, today’s highlight is CB Consumer Confidence, which is expected to dip to 113.9 points. The sole event in Canada is a speech from BoC Governor Stephen Poloz in Oshawa.
Donald Trump is used to getting his way in the private sector and on reality TV, but he had to swallow a bitter pill last week as he suffered his first major setback as president. His bill to replace the Affordable Care Act was pulled before it even went to a vote on the House floor, despite the Republicans enjoying a majority in Congress. This bruising defeat has sent the US dollar sharply lower, and sent market jitters higher. Trump’s administration has stumbled out of the starting gate, and after more than two months in office, he has yet to provide any details over even an outline of economic policy. The inquiry into the Trump administration’s links with Russia is gathering steam, and is another cause for concern for nervous investors. Trump has said he will now focus on tax reform, but he has his work cut out, trying to convince a skeptical Congress and general public that he can deliver the goods and pass new, effective legislation.
Weaker oil prices could weigh on the soft Canadian dollar. West Texas crude has dropped 1.0% in March, and dipped to $47.05 last week, its lowest level since the end of November. Crude headed lower after Crude Oil Inventories posted a strong surplus of 5.0 million barrels, crushing the estimate of 1.9 million. The weekly indicator has recorded only two declines in 2017, as US oil drillers continue to enter the market and ratchet up US oil production. This, together with increased US shale production, has more than offset OPEC’s production cuts. Last week, OPEC announced it was considering extending the production cut agreement by another 6 months, until the end of 2017, but it’s doubtful that such a move will prop up oil prices.
Tuesday (March 28)
- 8:30 US Goods Trade Balance. Estimate -66.6B
- 8:30 US Preliminary Wholesale Inventories. Estimate 0.2%
- 9:00 US S&P/CS Composite-20 HPI. Estimate 5.7%
- 10:00 US CB Consumer Confidence. Estimate 113.9
- 10:00 US Richmond Manufacturing Index. Estimate 16
- 10:10 BoC Governor Stephen Poloz Speech
- 13:00 US FOMC Member Robert Kaplan Speech
*All release times are GMT
*Key events are in bold
USD/CAD for Tuesday, March 28, 2017
USD/CAD March 28 at 7:05 EST
Open: 1.3386 High: 1.3414 Low: 1.3376 Close: 1.3401
- USD/CAD was flat in the Asian session and has edged higher in European trade
- 1.3371 switched to support following strong gains by USD/CAD in the Monday session
- 1.3461 is the next resistance line
Further levels in both directions:
- Below: 1.3371, 1.3253, 1.3120 and 1.3006
- Above: 1.3461, 1.3551 and 1.3672
- Current range: 1.3371 to 1.3461
OANDA’s Open Positions Ratio
USD/CAD ratio is unchanged this week. Currently, short positions have a majority (59%), indicative of trader bias towards USD/CAD continuing to move upwards.
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