Wednesday’s USD/CAD forecast shines with optimism as the Canadian dollar continues its collapse against the US dollar. This decline comes amid a growing interest rate advantage for the US dollar, fueled by improved US economic data. Moreover, there is anticipation ahead of a Bank of Canada policy decision.Aaron Hurd from State Street Global Advisors noted, “We are a little bit frozen going into the BoC meeting. However, since July, there has been a consistent weakening trend for the CAD against the US dollar.” Furthermore, he said, “I think the US will maintain that rate advantage for at least the next several quarters over Canada. The US economy is not showing the slowing we’ve seen in the Canadian economy.”On Tuesday, US economic data revealed an increase in business output in October. Manufacturing emerged from a five-month decline, boosting the US dollar against a basket of major currencies.Meanwhile, the spread between Canada’s 2-year yield and its US equivalent widened to 36.8 basis points, the widest gap since April 28. The Canadian yield fell further by 2.3 basis points. Additionally, Canadian new home prices fell by 0.2% in September compared to August and were down 1% annually, according to Statistics Canada. USD/CAD key events todayIt is a big day for USD/CAD as investors will watch the Bank of Canada policy meeting. Moreover, there will be key reports from the US, including:
USD/CAD technical forecast: Bulls secure their position above 1.3701.
USD/CAD 4-hour chart The USD/CAD pair has finally made a new high on the 4-hour chart. This move signals a continuation of the bullish trend and strengthens the bullish bias. Moreover, bulls have now found their footing above the 1.3701 key level. The first time the price broke above this level, it struggled to continue higher. Consequently, there was consolidation around the level until the price found support at 30-SMA. At the moment, bulls are making stronger candles above the 1.3701 level. Therefore, the uptrend will likely soon reach the 1.3800 resistance level. More By This Author:AUD/USD Price Analysis: Surprising Inflation Bolsters AussieEUR/USD Outlook: Extending Rally Fueled By Treasury Yield Slide Gold Price Challenging Uptrend Line, Eying US Data
