• The USD/CAD trims some of Tuesday’s losses up some 0.05%.
  • The BoC kept its cash rate unchanged at 0.25%, as expected by investors.
  • USD/CAD Price Forecast: Tilted to the downside, but risks to the upside remain.

The USD/CAD is modestly down during the New York session, trading at 1.2654 at the time of writing, after the Bank of Canada (BoC) maintained the Bank Rate unchanged at 0.25%, as market participants expected.

Market Reaction

As witnessed by the 1-hour chart, the USD/CAD pair spiked towards 1.2652, fading the upward move, retreating below the December 7 low around 1.2635,to then rebound where it hovers at press time.

In its statement, the Bank of Canada  (BoC) said that it expects CPI inflation to remain elevated in the first half o 2022 but awaits it would moderate by the second half, towards 2%. Furthermore, commented that CPI is elevated, and “the impact of global supply constraints is feeding through to a broader range of goods prices.”

Regarding the economic outlook, the BoC said that the economy had “considerable momentum” into the Q4, including the improvement in the labor market, which brought the employment rate back to its pre-pandemic level.  However, floods in British Columbia and uncertainty from the omicron variant “could weigh on growth by compounding supply chain disruptions, cutting demand for some services.”

The BoC commented that “in view of ongoing excess capacity,” the Canadian economy would continue to require monetary policy support and emphasized that they are “committed to holding the rate” until economic slack is absorbed. According to the BoC October projection, that will happen sometime in the middle quarters of 2022.

USD/CAD Price Forecast: Technical outlook

In the 1-hour chart, the USD/CAD has a downward bias, as shown by the hourly simple moving averages (SMA’s) residing well above the spot price. Furthermore, a substantial consolidation around the December 7 low at 1.2635, previous support-turned-resistance, as shown by seven candles rejected by the previously mentioned resistance. 

Nevertheless, in the outcome of breaking to the upside, the first resistance would be the daily high at 1.2663. A clear break of that level would expose key resistance levels, with the central daily pivot at 1.2679, followed by the 50-hour SMA at 1.2688, and then the R1 daily pivot at 1.2723.

On the other hand, if 1.2635 holds, that would exert downward pressure on the pair, exposing essential support areas. The first support would be the figure at 1.2600, followed by the S1 daily pivot at 1.2591, and the S2 daily pivot at 1.2547.


Today last price 1.2654
Today Daily Change 0.0006
Today Daily Change % 0.05
Today daily open 1.2648
Daily SMA20 1.2672
Daily SMA50 1.2541
Daily SMA100 1.2579
Daily SMA200 1.2477
Previous Daily High 1.2767
Previous Daily Low 1.2635
Previous Weekly High 1.2846
Previous Weekly Low 1.2713
Previous Monthly High 1.2837
Previous Monthly Low 1.2352
Daily Fibonacci 38.2% 1.2686
Daily Fibonacci 61.8% 1.2717
Daily Pivot Point S1 1.26
Daily Pivot Point S2 1.2552
Daily Pivot Point S3 1.2468
Daily Pivot Point R1 1.2732
Daily Pivot Point R2 1.2815
Daily Pivot Point R3 1.2863



Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news

Latest Forex News

Latest Forex News

Editors’ Picks

EUR/USD clings to modest daily gains near 1.1350 after US data

EUR/USD stays afloat in the positive territory near 1.1350 in the early American session as the greenback struggles to gather strength on retreating US T-bond yields. The data from the US revealed that Housing Starts and Building Permits rose by 1.4% and 9.1% on a yearly basis in December, respectively.


GBP/USD holds its ground in the positive territory above 1.3600

GBP/USD holds above 1.3600 in the second half of the day on Wednesday supported by the modest selling pressure surrounding the dollar. The benchmark 10-year US Treasury bond yield stays in the red in the early American session and the US Dollar Index edges lower toward 95.50.


Gold advances above $1,820 amid declining US T-bond yields

Gold continues to push higher on Wednesday and trades above $1,820. The benchmark 10-year US Treasury bond yield seems to have lost its traction following a three-day rally, supporting XAU/USD's upside.

Gold News

Crypto markets cling to the idea of a bullish breakout

BTC price is slowing down as it sticks close to a crucial support level with no volatility in sight. ETH and XRP are following the big crypto’s lead, showing no directional bias whatsoever.

Read more

Microsoft bets big on Metaverse with $69bln deal for Activision Blizzard

The move will give the tech giant access to Activision’s 390 million monthly users and headline franchises such as Call of Duty, Warcraft and Candy Crush. Find out why Microsoft has made this move.

Read more