Loonie Rides High as US Dollar Stumbles, But Challenges Loom Ahead
Login

Loonie Rides High as US Dollar Stumbles, But Challenges Loom Ahead

Estimated Reading Time: 2 minutes
Article Rating:
Based on 1 vote
Login to rate this article.

Azeez Mustapha

Updated:


In a delightful turn of events, the Canadian dollar, fondly known as the “loonie,” has spread its wings and soared against its American counterpart this morning. The US dollar’s stumble has provided a much-needed boost to the loonie. However, as we take a closer look, we find that the Canadian dollar faces a complex landscape filled with both promise and hurdles.

USD/CAD hourly chart from TradingView

The loonie’s recent gains can be attributed to the US dollar’s sudden case of the jitters, thanks to a surprising reevaluation of the Federal Reserve’s rate hike probabilities for June. However, we must tread cautiously as a more hawkish stance from the Fed threatens to tip the scales back in favor of the US dollar, leaving the loonie vulnerable to further losses.

Loonie Remained Tethered With the WTI Crude Oil

Unfortunately, the Canadian dollar’s fate is intertwined with the struggles of West Texas Intermediate (WTI) crude oil, which has been grappling to maintain its gains. However, a glimmer of hope flickers on the horizon in the form of the highly anticipated OPEC+ meeting in Vienna.

Should the attendees decide to spring a surprise production cut, the resulting boost in oil prices would undoubtedly lend a helping hand to the loonie’s cause. Although nothing is set in stone, recent comments by the Saudi Oil Minister hint at the possibility, so it’s worth keeping a watchful eye on this event.

Notes of US dollars and Canadian dollars

Canadian GDP Data on the Horizon

Tomorrow holds a significant event on the economic calendar—the release of Canadian GDP data. The numbers for the first quarter have been a bit lackluster, with March GDP flashing a discouraging -0.1% contraction. However, market expectations for the quarter-over-quarter (QoQ) figure stand at a positive 0.4%, while the annualized GDP growth rate is estimated to come in at a respectable 2.5%.

Keep in mind, though, that a disappointing April print could cast a shadow over these positive trends, potentially influencing the Bank of Canada’s decision-making process. Will they consider a rate hike at the central bank’s next meeting? That’s the question that looms large on the horizon.

 

You can purchase Lucky Block here. Buy LBLOCK

  • Broker
  • Benefits
  • Min Deposit
  • Score
  • Visit Broker
  • Award-winning Cryptocurrency trading platform
  • $100 minimum deposit,
  • FCA & Cysec regulated
$100 Min Deposit
9.8
  • 20% welcome bonus of upto $10,000
  • Minimum deposit $100
  • Verify your account before the bonus is credited
$100 Min Deposit
9
  • Over 100 different financial products
  • Invest from as little as $10
  • Same-day withdrawal is possible
$250 Min Deposit
9.8
  • The Lowest Trading Costs
  • 50% Welcome Bonus
  • Award-winning 24 Hour Support
$50 Min Deposit
9
  • Fund Moneta Markets account with a minimum of $250
  • Opt in using the form to claim your 50% deposit bonus
$250 Min Deposit
9

Learn to Trade

Never Miss A Trade Again

step 1
Signal Notification

Real-time signal notifications whenever a signal is opened, closes or Updated

step 2
Get Alerts

Immediate alerts to your email and mobile phone.

step 3
Entry Price Levels

Entry price level for every signal Just choose one of our Top Brokers in the list above to get all this free.

Share with other traders!

telegram
Telegram
forex
Forex
crypto
Crypto
algo
Algo
news
News