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BOC

USDCAD looks to 1.2550 on BOC dayA clear downside break of 100-SMA and monthly rising channel joins bearish MACD signals to keep USDCAD sellers hopeful as they brace for the Bank of Canada (BOC) Interest Rate Decision on Wednesday. It should, however, be noted that the RSI line inches closer to the oversold territory, suggesting a bumpy road to the south. That said, multiple tops marked during early November highlights 1.2590 as an intermediate halt before the quote drops towards 200-SMA and a six-week-old ascending support line near 1.2550. During the pair’s rebound, 100-SMA level surrounding 1.2690 and the 1.2700 threshold may test the buyers. Following that, the lower line of the stated broken channel, around 1.2790, will be important to watch as a clear run-up beyond the same will open the door for the USDCAD buyers targeting the weekly resistance line near 1.2865. In a case where the pair rises past 1.2865, the 1.2900 round figure, upper line of the channel close to 1.2935 and the yearly peak of 1.2950 will probe buyers ahead of the 1.3000 psychological magnet.
Short
by MTradingGlobal
USDCAD keeps rebound from 100-day EMA ahead of BOCUS dollar bulls dominate markets following the return of the American and Canadian traders on Tuesday, portraying the heaviest daily gains of the greenback in three weeks. The same portrayed the USDCAD bounce off 100-day EMA, keeping the recovery moves ahead of the key Bank of Canada (BOC) monetary policy meeting. Given the firmer RSI and fundamental scopes for the USD’s further upside, the pair buyers seem to aim for the late August tops surrounding 1.2710 by the press time. Following that, July’s high of 1.2806 and the yearly peak surrounding 1.2950 should lure the bulls. On the contrary, a daily closing below 100-day EMA surrounding the 1.2500 threshold needs validation from 50% Fibonacci retracement of June-August upside and late July’s bottom, respectively near 1.2475 and 1.2420, to please the USDCAD bears. If the pair sellers keep reins below 1.2420, the quote becomes vulnerable to drop towards the June 23 trough close to 1.2250. Overall, the Bank of Canada (BOC) is likely to repeat its hawkish bias and provide hints of tapering. However, any disappointment will be received with firmer USD to entertain the bulls.
Long
by MTradingGlobal
Canadian dollar rises ahead of GDPThe Canadian dollar continues to drift this week. In the European session, USD/CAD is trading at 1.2037, down 0.08% on the day. Canada's economy is expected to have surged ahead in the first quarter of the year. GDP grew at an impressive rate of 9.8% (YoY) in Q4. The consensus for Q1 stands at 6.8%, which would bring growth close to pre-Covid levels. These GDP figures are impressive, but should be taken with a grain of salt, as that they are in comparison to figures from a year ago, when Covid was at its height and caused a steep economic downturn. The economic recovery has been fuelled by a resurgence in exports and the strong housing market. Interestingly, the recovery has forged ahead largely without the support of consumer spending, a key driver of economic growth. Strict lockdowns have put a crimp in consumer spending, but pent-up demand is expected to translate into a surge in consumer spending later n the year. Canada's Covid vaccine rollout has been sluggish, but infection rates are slowly receding. This has meant that health restrictions have been eased as the economy reopens. In April, the Bank of Canada was the first major central bank to announce a tightening in policy. With the US and UK economies heating up, the Fed and BoE may well follow the BoC example and taper their QE programmes. The BoC has signalled that its key interest rate could rise above the current 0.25% in late 2022. If the BoC continues to drum a hawkish message, the Canadian dollar could break below the 1.20 level, which has held since 2015. USD/CAD faces resistance at 1.2137 and 1.2195. The pair continues to test support at 1.2025. Below, there is support at 1.1971.
by OANDA