Fundamental Overview
The US Dollar started the week on the backfoot as the odds of a Harris victory jumped higher leading to a pullback in the Trump’s trades.
Everything hinges on the US election now with a red sweep seen as the most bullish scenario for the greenback, while a blue sweep as the most bearish.
The price action will likely be choppy until we start to get a better sense of who’s going to win, so the best strategy would be to wait for the results, because the trend that will be set will likely last for months anyway.
USDCAD Technical Analysis – Daily Timeframe
On the daily chart, we can see that USDCAD pulled back from the 2-year highs amid some greenback weakness. The buyers will want to see the price breaking above the high to increase the bullish bets into new highs, while the sellers will look for a break below the 1.3860 level to start looking for more downside.
USDCAD Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see that the price broke below the minor upward trendline that was defining the bullish momentum on this timeframe. These are generally signals of weakening momentum, so we might see a deeper pullback. The buyers will likely step in around the 1.3860 level, while the sellers will look for a break lower to increase the bearish bets into the 1.3785 level next.
USDCAD Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see more clearly the rangebound price action of the last few days as the market awaits the US election result. There’s not much else we can add here as the election noise will likely lead to a choppy price action until we get the results. The red lines define the average daily range for today.
Upcoming Catalysts
Today is the US Presidential Election Day but we will also get the US ISM Services PMI report. On Thursday, we have the US Jobless Claims and the FOMC Policy Decision. On Friday, we conclude the week with the Canadian Labour Market report and the US University of Michigan Consumer Sentiment report.
