USDCAD Forecast: Canadian dollar higher as risk appetite returns after US election

Kenny Fisher MarketPulse

The Canadian dollar has posted gains in the Wednesday session, USD/CAD is trading at 1.3080, down 0.33% on the day. On the release front, Canada releases Ivey PMI, which is expected to improve to 50.9 points. There are no major U.S releases on the schedule. On Thursday, Canada releases Housing Starts. In the U.S, the Federal Reserve will set the benchmark rate and release a rate statement. We’ll also get a look at unemployment claims.

Investors expressed relief that the uncertainty over the U.S mid-term elections is over, with both the Republicans and Democrats able to point to a victory of sorts. The markets were pleased that President Trump did not suffer a stinging defeat. Had the Democrats taken back both houses of Congress, Trump would have been a lame duck for the next two years, and he would have had great difficulty passing any further market-friendly reforms. The mixed results have improved risk appetite, and the Canadian dollar has responded with gains on Wednesday.

Participation was high in the mid-term elections on Tuesday, and voters rendered a split-decision. The Democrats regained control of the House of Representatives for the first time since 2010, but the Republicans maintained control of the Senate, and have increased their majority. The results are a setback for President Trump, as the Democrats will be in a stronger position to derail Trump’s plans to boost fiscal stimulus and lower taxes.

Commodities Weekly: Oil near 7-month lows on Iran waivers

Investors relieved as blue wave falls short

USD/CAD Fundamentals

10:00 Canadian Ivey PMI. Estimate 50.9
10:30 US Crude Oil Inventories. Estimate 2.0M
13:01 US 30-year Bond Auction
15:00 US Consumer Credit. Estimate 15.7B
8:15 Canadian Housing Starts. Estimate 199K
8:30 US Unemployment Claims. Estimate 214K
14:00 US FOMC Statement
14:00 US Federal Funds Rate. Estimate <2.25%

Open: 1.3124 High: 1.3159 Low: 1.3073 Close: 1.3080

USD/CAD Technical

S3	S2	S1	R1	R2	R3
1.2733	12831	1.2970	1.3099	1.3198	1.3292

USD/CAD posted small losses in the Asian session. The pair moved higher early in European trade, but has reversed directions and moved lower.

1.2970 is providing support
1.3099 is the next resistance line
Current range: 1.2970 to 1.3099

Further levels in both directions:

Below: 1.2970, 1.2831 and 1.2733
Above: 1.3099, 1.3198, 1.3292 and 1.3383

Author

Kenny Fisher

MarketPulse

A highly experienced financial market analyst with a focus on fundamental analysis, Kenneth Fisher’s daily commentary covers a broad range of markets including forex, equities and commodities.

GBP/USD remains slightly bid near 1.3300

GBP/USD now advances marginally and manages to dispute the 1.3300 region on Tuesday. Indeed, Cable regains some balance on the back of the lacklustre performance of the Greenback, all preceding the Fed’s meeting on Wednesday and the BoE’s gathering on Thursday.

EUR/USD recedes from tops, back below 1.1400

EUR/USD manages to set aside part of the recent weakness and clinches decent gains on Tuesday. Indeed, spot keeps the trade below the 1.1400 mark amid acceptable losses in the US Dollar, all following rising optimism of a US-Iran deal and steady caution prior to the FOMC gathering on Wednesday.

Gold bounces on poor US data

Gold remains under marked downside pressure on Tuesday, although the $4,000 zone per troy ounce emerges as a decent support for now. The precious metal’s pullback comes despite the modest losses in the US Dollar in a context of easing geopolitical tensions ahead of the key Fed event on Wednesday.

XRP falls toward $1.00 despite dwindling exchange reserves

Ripple (XRP) continues to trade under increasing pressure on Tuesday. This marks the second consecutive day of declines, reflecting broader risk-off sentiment as investors appear to shift gears in anticipation of the Federal Reserve (Fed) interest rate decision. On Wednesday, the Federal Open Market Committee (FOMC) is widely expected to leave interest rates unchanged in the 3.50%-3.75% range.

Warning signs in the stock market: Is this the top, or just a very short fuse?

Overnight, South Korea's Kospi fell more than 10%, SK Hynix lost close to 15% and Samsung Electronics lost 13%. Into that, Dow Jones Industrial Average futures traded up around 1% on paint and soft drinks, and S&P 500 futures sat roughly flat. An index that absorbs a memory-chip panic and prints nothing is not a calm market.

US Dollar mid-year outlook: Exceptional currency, exceptional risks?

The US Dollar enters the second half of 2026 in a markedly different position from a year ago. The King currency has recovered, reflecting persistent US inflation, changing expectations for Fed policy, geopolitical tensions and renewed demand for defensive assets.