- USD/CAD witness follow-through selling after it settled down -0.74% on Monday.
- US elections put a lid on USD strength as investors are more cautious.
- Oil prices supported the Loonie and encouraged more CAD buying.
USD/CAD continued to trade in the red today after falling by over 150 pips yesterday. The pair trades below 1.3200 in the European session after a brief consolidation during the early trading.
The US presidential elections prompted many traders to unwind their bullish dollar-bets and pushed the USD/CAD down.
The polls ahead of the official results suggest a Biden triumph over Trump, but investors are not taking any bet based on it as the actual result could differ. Other than the election worries, the current market mood doesn’t favour haven-linked assets like the dollar.
The bullish price-action in oil helped the CAD’s strength and exerted weight on the USD/CAD. The black-gold prices recovered from multi-month lows after reports indicated Russian oil firms agreeing to OPEC+ production cuts.
The pair witnessed some technical selling below 1.3200 round-figure mark in recent hours of trading, but need further confirmation for a sustained move; a bounce-back can also happen due to buying at lower levels. It is prudent to anticipate a range bound action until clarity emerges on the key political happening.
At the time of writing, one US dollar buys 1.3149 Canadian dollars, down -0.51% as of 10:33 AM UTC.