Fundamental Background of the Canadian Dollar
The Canadian dollar’s performance is closely tied to the ongoing negotiations regarding the US debt ceiling, which has resulted in increased support for the US dollar (USD). Additionally, the recent rally in crude oil prices has somewhat limited the upside potential for USD/CAD bulls before the start of the US trading session. The announcement made by OPEC+ addressing short sellers prior to the June 4th meeting has further boosted oil prices. Iraq’s oil minister has expressed commitment to the OPEC+ cuts, providing additional support to the upward movement in crude oil prices, according to DailyFX.com.
The upcoming release of US PMI data may introduce some short-term volatility for the USD/CAD pair. However, based on estimates, the Canadian dollar may regain some ground against the greenback.
Current Price Action of USD/CAD
The daily price action of USD/CAD is currently testing the upper boundary of a medium-term symmetrical triangle pattern while coinciding with the 50-day moving average. Despite the recent break above the psychological level of 1.3500, which usually triggers bullish sentiment, the market has yet to display strong optimism towards the resistance level of the triangle. The current daily candle is forming a long upper wick, and if it closes in this manner, it suggests potential downside from a technical perspective.
Discover the power of online trading with OFP – get started today!
<a rel=”nofollow,noindex” href=”https://www.dailyfx.com/news/forex-usd-cad-price-forecast-loonie-on-offer-despite-stronger-crude-oil-prices-wv-20230523.html”>Click here to read the original article (DailyFX.com)</a>