USD/CAD: Canadian Dollar gains on optimism over USMCA trade deal
|- Canadian dollar has recovered early losses on positive USMCA-related newsflow.
- USD/CAD is trading at the 100-day average support of 1.3230.
- Thursday's low is the level to beat for the bears.
The bid tone around the Canadian dollar (CAD) has strengthened with reports stating that an agreement on the US-Mexico-Canada Agreement (USMCA) is close and there could be an official announcement of the same on Tuesday.
The USD/CAD pair is currently trading at 1.3230, representing marginal losses on the day, having hit a high of 1.3245 in early Asia.
Canadian Prime Minister Justin Trudeu’s office issued a statement at 1:03 GMT stating that Trudeau spoke with Trump about USMCA and the two are working out the final negotiations of the deal.
Meanwhile, the US House and Means Committee Chairman Neal and the House Speaker Nancy Pelosi said that an official announcement is likely to come through on Tuesday. White House adviser Jared kushner also echoed similar sentiments soon before press time.
The Canadian dollar has erased early losses on positive trade related newsflow and may extend gains further during the day ahead. That said, the technical outlook for USD/CAD would turn bearish only below Thursday’s low of 1.3158.
The CAD took a beating on Friday after the US jobs data for November blew past expectations, forcing markets to price out the prospects of a Federal Reserve rate cut in 2020. Meanwhile, the Canadian economy unexpectedly shed 71k jobs, the biggest loss since the financial crisis.
Technical levels
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.