USD/CAD Price Forecast: Seems poised to surpass 61.8% Fibo. hurdle near mid-1.4500s

USD/CAD enters a bullish consolidation phase near one-month high set on Monday.

Bearish Oil prices undermine the Loonie amid worries about a US-Canada trade war.

A modest USD uptick lends additional support to the major and favors bullish traders. 

The USD/CAD pair holds steady around the 1.4500 psychological mark during the Asian session on Tuesday and remains close to a one-month top touched the previous day. The US Dollar (USD) ticks higher amid worries that US President Donald Trump's tariffs could reignite inflation and force the Federal Reserve (Fed) to keep interest rates higher for longer. Moreover, bearish Crude Oil prices undermine the commodity-linked Loonie amid concerns about the US-Canada trade war and act as a tailwind for the currency pair. 

From a technical perspective, the overnight goodish bounce from the vicinity of the 50-day Simple Moving Average (SMA) and a subsequent move beyond the 50% Fibonacci retracement level of the downfall from a multi-year peak touched in February favor bullish traders. Moreover, oscillators on the daily chart are holding comfortably in positive territory and are still away from being in the overbought zone. This suggests that the path of least resistance for the USD/CAD pair remains to the upside and supports prospects for further gains.

Hence, some follow-through strength back towards retesting the 1.4545 area, or the one-month peak, which coincides with the 61.8% Fibo. level, looks like a distinct possibility. Some follow-through buying would set the stage for an extension of a nearly two-week-old uptrend and allow the USD/CAD pair to reclaim the 1.4600 round figure. The momentum could extend further towards the 1.4665-1.4670 intermediate hurdle en route to the 1.4700 neighborhood, or the highest level since April 2003 touched on February 3.

On the flip side, weakness below the 50% Fibo. level, around the 1.4470 area, might continue to attract some dip-buyers near the 1.4400 mark or 38.2% Fibo. level. This should help limit the downside near the 1.4360-1.4350 region or the 50-day SMA. That said, some follow-through selling could shift the bias in favor of bearish traders and drag the USD/CAD pair to the 1.4300 mark (23.6% Fibo. level) en route to the next relevant support near the 1.4240-1.4235 zone. Spot prices could slide further towards the 1.4200 mark before eventually dropping to the mid-1.4100s, or the year-to-date low touched last month. 

USD/CAD daily chart