CAD - USD/CAD pair initially stabilizes amid bleak US-Canada trade outlook

US President Trump stated that the U.S. and Canada will not restart trade negotiations. This follows Trump's announcement of the suspension of trade talks with Canada and the imposition of an additional 10% tariff on Canadian goods, citing a political ad in Ontario that used video footage of Republican icon and former President Reagan stating that tariffs would lead to a trade war and economic disaster.

Statistics Canada data showed that Canada's GDP unexpectedly contracted by 0.3% in August, breaking market expectations of zero growth; preliminary indicators suggest that September GDP may have grown by 0.1%, bringing the third-quarter annualized growth rate to 0.4%, lower than the Bank of Canada's forecast of 0.5%.

The US dollar/Canadian dollar pair rebounded from its lows last week and climbed back above its 200-day moving average, suggesting a potential resurgence in the pair. Furthermore, the RSI and Stochastic Oscillator have also shown initial signs of recovery. Resistance levels are expected at 1.4080 and 1.42, with the next level anticipated at the April 1st high of 1.4415 to 1.45. The supporting levels are estimated at 1.3920 and 1.3860, with the next level expected at 1.38.

Forecast Range:
Resistance 1.4080 – 1.4200 – 1.4415 – 1.4500
Support 1.3920 - 1.3860 – 1.3800

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31/10 Trump says US and Canada will not restart trade negotiations

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