USD/CAD Price Forecast: Holds gains near 1.4000, bullish signals support upside
The USD/CAD pair trades in positive territory around 1.3995 during the early European trading hours on Friday. The US Dollar (USD) extends its rally against the Canadian Dollar (CAD) on a hawkish tone from the US Federal Reserve (Fed).
The USD/CAD currency pair maintains a bullish outlook near the 1.4000 mark as of Friday morning. The US Federal Reserve (Fed) recently announced a quarter-percentage point interest rate hike, signaling a hawkish stance on monetary policy that could bolster the USD against the Canadian Dollar (CAD). The CAD faces support from its role as a major oil exporter, and recent geopolitical tensions in the Middle East could further drive up crude oil prices, positively impacting the Canadian currency.
However, the CAD has underperformed compared to other major currencies, leaving it vulnerable to potential losses. Technical analysis indicates a strong bullish bias for USD/CAD, with the pair trading above the 100-day simple moving average and supported by Bollinger Bands. The next major resistance level is the August 5 high of 1.4080, followed by the July 7 high of 1.4226 and June 24 high of 1.4248.
Factors such as Bank of Canada interest rates, oil prices, economic health, inflation, Trade Balance, and global market sentiment also influence the CAD's value.
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