USD/CAD Price Analysis: Dollar Weakens After Debate

• Tuesday’s presidential debate weighed on the dollar, with Kamala Harris coming out stronger.

• Analysts expect lower price pressure in the US, at 2.6% annually.

• The Canadian dollar lost ground in the previous session as oil prices fell.

USD/CAD price analysis shows a slight pullback amid a bullish trend as the greenback falls after the US presidential debate. Meanwhile, investors remained cautious ahead of US inflation data, which could provide clues about the Fed’s interest rate cut prospects.

–Interested in learning more about forex options trading? Check out our detailed guide –

Tuesday’s presidential debate weighed on the dollar, with Kamala Harris coming out stronger. The dollar favors a Trump victory because tariffs and government spending would rise, raising interest rates. However, after the debate, bets on a Trump victory dropped.

Meanwhile, investors remained cautious ahead of the US CPI report. Analysts expect lower price pressure at 2.6% on an annual basis. Meanwhile, on the month, inflation is likely to hold steady at 0.2%. If price pressures ease significantly, bets for a 50 bps rate cut will increase, putting pressure on the dollar. On the other hand, if inflation supports a gradual rate cut cycle, the dollar could rise. There is currently a 67% chance of a 25bps rate cut. The CPI report will provide more clues about the size of the rate cut at next week’s FOMC policy meeting.

Elsewhere, the Canadian dollar lost ground in the previous session as oil prices fell. Demand concerns have put a lot of pressure on the fuel. At the same time, Bank of Canada Governor Tiff Macklem gave a speech in which he said there was a chance for more significant rate cuts if growth missed forecasts.

Key USD/CAD Events Today

• Core CPI m/m
• CPI m/m
• CPI y/y

USD/CAD Price Technical Analysis: Bullish momentum stops at 1.3600 resistance

Technically, the USD/CAD price broke its rally near the 1.3600 resistance level. Bulls briefly pierced the level before retreating lower. However, the bullish trend remains as the price is trading above the 30-SMA. At the same time, the RSI is in bullish territory above 50.

–Are you interested in learning about forex robots? Check out our detailed guide –

If the pullback continues, the price is likely to review the 30-SMA support soon. However, if the bulls maintain control, it will reject the SMA to retest the 1.3600 resistance level. A break above 1.3600 will clear the way for the price to climb to the 1.3701 resistance level.

Want to trade forex now? Invest at eToro!

67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.