The USD/CAD pair rose during the session on Tuesday as the US dollar continues to be bid up in general. The market is one that needs to rise back above the 1.02 level for the buyers to have something to “hanging their hat on”, and that’s exactly what it did during the session. Because of this, we think that it will be choppy, but we could very well see a move towards the 1.03 handle. The FMOC meeting is today, and as a result the statement will be heavily scrutinized. That being said, if there is more talk of potential “tapering” of quantitative easing, we think that should push the value of the US dollar higher against most currencies, with the Canadian dollar being no different. However, if we managed to break to a new low, we think this market will grind its way down to the parity handle.
Written by FX Empire