The USD/CAD pair is making some serious waves, riding high at around 1.3425 during the first half of the European session. What’s driving this impressive surge? A combination of factors, including falling oil prices and a stronger USD, are lifting the pair to a four-day high, with the 200-day Simple Moving Average (SMA) providing additional support.

While the Canadian dollar is taking a beating due to several factors, such as cooling consumer inflation and falling oil prices, the USD is enjoying a strong demand thanks to a further increase in US Treasury bond yields. This is mainly due to prospects of further policy tightening by the Federal Reserve (Fed), with markets fully pricing in a 25 bps lift-off in May and a small chance of another rate hike in June.

The rise in the USD/CAD pair is a clear indication of a breakout through the 200-day SMA. And with no major market-moving economic data on the horizon, investors are eagerly anticipating the release of the Fed’s Beige Book for insights into the state of the US economy. This, along with the US crude inventory report by the Energy Information Administration (EIA), which should influence oil price dynamics, is expected to provide some short-term opportunities around the pair.

So, buckle up, folks! It looks like the USD/CAD pair is on a wild ride, defying gravity and soaring higher than ever. Keep your eyes peeled for the latest news and trends as this pair continues to push the limits of what’s possible in the world of Forex trading.

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