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Ali Farhad

CAD

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I am assuming this is looking at the USDCAD chart. However, while we have seen the USD strengthen against the CAD and continue today, I think technically yes there could be a pull back. But, on a macro level there is one main reason why we have seen the CAD weaken. it is due to the coronavirus.

This has caused the Chinese economy to slow down significantly and as a result their oil purchases have fallen. Resulting in a big fall in oil prices. And as Canada is heavily reliant on oil for their economy it has mean the CAD has reduced in value. Now add to that the risk of the virus and the fact it has caused investors to pour money into safe havens like the dollar, it results in a massive rise in the USDCAD. So while we are due a retracement, we can only assume it will arrive when risk reduces.

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