USD/CAD refreshes day high above 1.3720 as investors turn cautious ahead of Fed policy

USD/CAD is hovering near day's high around 1.3720 amid anxiety among investors as they await Fed policy.
US equities are facing severe heat led by deepening fears of global banking turmoil.
Oil price has corrected to near $66.30 as the PBoC maintains the status quo.

Sagar Dua FXStreet

The USD/CAD pair has printed a fresh intraday high at 1.3725 in the Asian session. The upside in the Loonie asset has been fueled by a recovery move from the US Dollar Index (DXY) and a corrective move in the oil price. Soaring anxiety among investors ahead of the interest rate decision by the Federal Reserve (Fed) is improving USD Index’s appeal.

The USD Index has recovered to 103.87 and is gathering strength to extend its recovery above the immediate resistance of 104.00. Meanwhile, S&P500 futures have surrendered the majority of their gains earned in the early Tokyo session. This portrays that the risk aversion theme is extremely solid and investors are using rallies for building more shorts.

US equities are facing severe heat led by deepening fears of global banking turmoil and anxiety among investors ahead of Fed policy. In a recent poll by Reuters, 76 of 82 economists believe that the US Federal Reserve (Fed) would raise its policy rate by 25 basis points (bps) to the range of 4.75-5% following the March Federal Open Market Committee (FOMC) meeting.

Meanwhile, the Canadian Dollar is dancing to the tunes of the inflation data, which will release on Tuesday. As per the consensus, the monthly headline Consumer Price Index (CPI) is expected to accelerate by 0.4%, lower than the former release of 0.5%. This might drag the annual headline CPI further to 5.5%. Also, the annual core CPI is expected to trim to 4.6% from the former release of 5.0%.

Investors should be aware of the fact that Bank of Canada (BoC) Governor Tiff Macklem has already held interest rates steady at 4.5%. BoC Macklem considers the current monetary policy as restrictive enough to scale down price pressures.

On the oil front, oil price has corrected to near $66.30 as the People’s Bank of China (PBoC) kept the interest rate policy unchanged. The street was anticipating an expansionary policy to infuse more liquidity into the economy. It is worth noting that Canada is a leading exporter of oil to the United States and lower the oil price might impact the Canadian Dollar further.

USD/CAD

Overview
Today last price	1.372
Today Daily Change	-0.0009
Today Daily Change %	-0.07
Today daily open	1.3729

Trends
Daily SMA20	1.3658
Daily SMA50	1.3497
Daily SMA100	1.351
Daily SMA200	1.334

Levels
Previous Daily High	1.3773
Previous Daily Low	1.3678
Previous Weekly High	1.3828
Previous Weekly Low	1.3652
Previous Monthly High	1.3666
Previous Monthly Low	1.3262
Daily Fibonacci 38.2%	1.3737
Daily Fibonacci 61.8%	1.3714
Daily Pivot Point S1	1.368
Daily Pivot Point S2	1.3631
Daily Pivot Point S3	1.3585
Daily Pivot Point R1	1.3776
Daily Pivot Point R2	1.3822
Daily Pivot Point R3	1.3872

Author

Sagar Dua

FXStreet

Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.

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