The post USD/CAD consolidates below mid-1.3800s, bullish potential seems intact appeared on BitcoinEthereumNews.com.

USD/CAD bulls take a breather after the recent runup to the highest level since August 6. The recent upswing in the USD acts as a tailwind for the pair amid a downtick in Oil prices. Bets for a larger BoC rate cut support prospects for a further near-term appreciating move. The USD/CAD pair oscillates in a narrow band around the 1.3830 region during the Asian session on Tuesday and remains well within the striking distance of its highest level since August 6 touched the previous day. Meanwhile, the fundamental backdrop seems tilted in favor of bullish traders and suggests that the path of least resistance for spot prices remains to the upside.  Crude Oil prices struggle to capitalize on the previous day’s modest gains amid concerns over slowing demand and a prolonged economic downturn in China – the world’s top importer. Apart from this, bets for a larger, 50 bps rate cut by the Bank of Canada, bolstered by softer domestic consumer inflation figures, might continue to undermine the commodity-linked Loonie. This, along with the underlying strong bullish sentiment surrounding the US Dollar (USD), validates the near-term positive outlook for the USD/CAD pair.  The incoming upbeat US macro data suggested that the economy remains on a strong footing, which should allow the Federal Reserve (Fed) to be patient in cutting interest rates. Moreover, the recent comments by a slew of influential FOMC members reaffirmed market expectations for a less aggressive policy easing by the US central bank. This, in turn, pushes the US Treasury bond yields and the USD Index (DXY), which tracks the Greenback against a basket of currencies, to their highest level in almost three months. Furthermore, a turnaround in the global risk sentiment – as depicted by a softer tone around the equity markets – should continue…

---

Filed under: News - @ October 22, 2024 3:05 am