BoC held rates steady at 1.75%, matching widespread expectations. The bank watered down its commitment to normalization, saying “Governing Council judges that the outlook continues to warrant a policy interest rate that is below its neutral range. Given the mixed picture that the data present, it will take time to gauge the persistence of below-potential growth and the implications for the inflation outlook. With increased uncertainty about the timing of future rate increases, Governing Council will be watching closely developments in household spending, oil markets, and global trade policy. Contrast that with January, they maintained their commitment to normalization, saying that “Governing Council continues to judge that the policy interest rate will need to rise over time into a neutral range to achieve the inflation target.” In our view, this announcement rules out a rate hike from the BoC this year.

USDCAD  shot higher, breaking the significant 1.3440 barrier, following the BoC’s no-change announcement, and dovish statement, which said Canada’s slowdown was sharper and more broad based than earlier expected. The 1.3440 represents the 61.8% Fibonacci retracement levels from the downleg seen since December., which theoretically consider be a strong retracement level. Hence ce a close today below this area could suggest a pullback and a retest of the 50% fib. level at 1.3360, which could be supportive for the pair. The latter is the 2-month Resistance for Loonie so far, which now converted to Support.

If the asset moves further northwards, the next Resistance is set at 1.3495-1.3520 area (January 4 peak and 76.4% Fib.  level).

The daily technical indicators are neutral to positive, as RSI is looking to the upside and MACD has turn positive however signal line remain in the negative side.

USDCAD

USDCAD

Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.

Analysis feed

Latest Forex Analysis

Editors’ Picks

EUR/USD tension remains elevated ahead of the Fed

EUR/USD is trading above 1.1050, in a narrow range ahead of the all-important Fed decision. Chair Powell is set to cut rates but signal no further stimulus is on the cards.

EUR/USD News

GBP/USD extends its falls to 1.2450 amid weak UK inflation, Brexit impasse

GBP/USD has dropped to around 1.2450 as UK headline CPI missed with 1.7% in August. Brexit negotiations remain stuck according to Chief EU negotiator Barnier. The Fed decision is eyed.

GBP/USD News

USD/JPY holds on to recovery gains above 108.00 ahead of Fed

Not only upbeat trade numbers from Japan but upbeat trade/political headlines also help the USD/JPY pair to remain firm around 108.20 prior to Wednesday’s European session. Focus on FOMC decision.

USD/JPY News

Forex Today: Fed set to trigger high volatility, oil falls, altcoins advance

Tension is mounting ahead of the Federal Reserve decision later today. Economists expect a 25 basis point rate cut amid slowing global growth and investment. 

Read more

Gold: Pivots around $1500 mark, awaits FOMC policy update

Gold extended its sideways consolidative price action through the early European session on Wednesday and was seen pivoting around the key $1500 psychological mark, awaiting FOMC policy decision.

Gold News

Forex Majors

Cryptocurrencies

Signatures