USD/CAD Analysis Today 04/02: Volatile Amid Tariffs (Chart)

(MENAFN- Daily Forex) The USD/CAD spiked in early trading yesterday as tariff threats from the trump administration created nervousness and reactive price velocity, but calm was restored later in the day.

The USD/CAD is trading near the 1.44535 as of this writing, yesterday's early price action took the currency pair above the 1.47920 ratio as financial institutions showcased their nervous sentiment. President Trump did not back away from his tariff threats over the weekend, and President Trudeau eventually spoke to the U.S White House and apparently made some inroads to help stop U.S policy from being implemented yesterday.

A one month delay has been granted to Canada in order to try and find a working agreement with the Trump administration. The sea of volatility produced yesterday has now calmed down in the USD/CAD. The ability of the currency pair to traverse its current price brings it back into consideration of lower support near the 1.44000 level. The question financial institutions need to answer is regarding their outlook for the mid-term and this is clearly playing into short-term volatility. Fast price changes are still being seen.

Top Forex Brokers1 Get Started 74% of retail CFD accounts lose money Lack of Clarity and a USD/CAD Scorecard

Timeframes are always important in Forex. Day traders have a different set of factors they have to battle in Forex compared to financial institutions. Yesterday's price action in the USD/CAD was violent and other currencies teamed against the USD also suffered. Financial institutions clearly showed that they believed if Canada was going to try and say no to the Trump administration that they would have less faith in the Canadian Dollar. Thus, the USD/CAD was bought in mass. The USD won the battle.

After Justin Trudeau, who will be leaving office sooner rather than later, relented and spoke to Donald Trump the USD/CAD recovered. However, there is still a lack of clarity regarding the mid-term regarding tariffs. Yesterday's results however showed that financial institutions believe a solution will be found and the USD/CAD then found selling. It really is that simple. Attitudes are important in Forex and the USD/CAD proved this on Monday Choppiness as Sentiment is Considered

Today and tomorrow in the USD/CAD are likely to remain choppy. However, a calmer price range should be seen in the near-term without the spikes that demonstrated yesterday. Technical traders may feel safe enough to venture forth and try wagering on perceived technical support and resistance levels.

• Traders are warned not to get overly ambitious regarding the ability of the USD/CAD to selloff significantly quite yet and test depths seen pre-Christmas.
• The 1.44000 to 1.43000 levels may prove to be durable until further evidence is produced that Canada will negotiate with the U.S regarding threatened tariffs.
• Stop loss order usage is highly recommended to protect against the threat of sudden developments regarding news flow between U.S and Canada.

EURUSD Chart by TradingViewCanadian Dollar Short Term Outlook:

Current Resistance: 1.44610

Current Support: 1.44360

High Target: 1.45100

Low Target: 1.44010

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