USD/CAD Price Forecast November 8, 2017, Technical Analysis

USD/CAD daily chart, November 08, 2017

The US dollar rallied significantly during the day on Tuesday, breaking above the 1.28 level in a surge higher. Crude oil markets now have to worry about a lack of demand according to OPEC, and that should continue to work against the Canadian dollar overall. By breaking above the 1.2775 handle, I now look at this as a market that has formed a bit of a bottom, and we should continue to go higher. I think that the 1.30 level above is the longer-term target, but it may take some time to get there. A move above there should send this market to much higher levels, perhaps turning it into a “buy-and-hold” scenario. Pullbacks should continue to find support down at the 1.27 handle, and I believe that a “buy on the dips” attitude should continue to be the attitude overall.

Ultimately, if we can break above the 1.30 level, the longer-term target would be the 1.35 handle. Pay attention to the crude oil markets, because quite frankly it is the biggest influence on the Canadian dollar longer term. If interest rates continue to rally in the United States as well, that should send this market much higher. Ultimately, this is a market that has a lot of the volatility build and as the economies are so highly correlated, and therefore it is not a marketplace that is always easy to trade. Overall, this is a market that continues to find reason to go higher, even after the recent bond market influences. Overall, I believe that the buyers are going to flex their muscles, and I also believe in adding small positions every time we dip, assuming that we can continue to show signs of strength to the upside. I plan to build a very large position over the next several months.

Written by FX Empire