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"Ironically, the worse [the threat from] the fiscal cliff, the better the dollar will likely do because the U.S. dollar is so linked to global risk appetite and the threat of a U.S. recession would likely see the dollar appreciate on safe-haven flows"
- Saxo Bank (based on Reuters)Pair's Outlook
Trading range of USD/CAD gradually widens, while the pair establishes a bullish tendency it is likely to adhere to in the long-term. Nonetheless, this scenario is not viable as long as the 200-day weighs upon the price and impedes growth. Consequently, we need a strong sustainable rally above 1.0001/10 to be sure in positive outlook, but until then a struggle with the 200-day SMA should define behaviour of the pair.
Traders' Sentiment
According to SWFX traders' sentiment, there is a 62% probability USD/CAD to carry on advancing, while 38% of market participants believe in an alternative scenario and expect the loonie to gain value. Positive outlook of the market on the pair is also backed up by the fact that buy orders (65%) exceed sell orders (35%).
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