Canadian Dollar snaps six-day losing streak on Monday

• The Canadian Dollar caught a brief reprieve from steady selling pressure.
• Canada delivers CPI inflation figures this week, ending a data dry spell.
• The CAD still remains deeply discounted against the Greenback.

The Canadian Dollar (CAD) tiled into the bullish side for the first time in over a week on Monday, kicking off the trading week’s chart action with a meager bullish recovery against the Greenback. Market flows are less about bidding up the Loonie than they are taking a breather from one-sided US Dollar buying, and sustained recovery momentum is unlikely to build underneath the CAD’s tattered wings.

Canada is set to release its first batch of impactful economic data in over a week on Tuesday. Headline Canadian Consumer Price Index (CPI) inflation figures for October are expected to accelerate on an annualized basis. The Bank of Canada (BoC) will also be releasing it’s own special version of Canadian CPI, but markets are struggling to nail down a forecast for the CPI metric.

Daily digest market movers: Canadian Dollar gets reprieve from Greenback strength

• The Canadian Dollar recovered half of a percent against the Greenback as the Loonie struggles to pare back ground from multi-year lows.
• Canadian CPI inflation figures are due on Tuesday. Headline CPI inflation for the year ended in October is expected to accelerate to 1.9% YoY from 1.6%. October’s monthly CPI inflation print is expected to swing back to 0.3% after the previous month’s -0.4% contraction.
• USD data remains on the tepid side this week, giving markets a much-needed break from US-centric economic data releases.
• A smattering of Federal Reserve (Fed) officials making appearance this week could throw a wrench in the works. Fedspeak has drifted toward the cautious side in recent weeks.
• Canadian Retail Sales for September also loom ahead at the end of the week on Friday.

Canadian Dollar price forecast

The Canadian Dollar (CAD) is drifting back into the bullish side against the US Dollar on Monday. However, the Loonie has found itself at the bottom of a very long hole after falling to multi-year lows against the Greenback and sending USD/CAD to 54-month highs late last week.

A slight paring of the pair’s recent peaks is unlikely to spark a sustained move, so bears should be ready to wave goodbye to the prospect of a sustained move lower back into the 200-day Exponential Moving Average (EMA) near 1.3675.

USD/CAD daily chart