- – The US Dollar bounced back from the 1.2530 support level against the Canadian Dollar.
- – There was a break above a connecting bearish trend line with resistance at 1.2590 on the hourly chart of USD/CAD.
- – Recently in Canada, the BoC Interest Rate Decision (March 2018) was announced by the Bank of Canada.
- – The outcome was around the forecast as there was no change in the interest rates from 1.25%.
BoC Interest Rate Decision
However, the actual result was around the forecast as there was no change in the interest rates from 1.25%. The Bank Rate was kept at 1.5 per cent and the deposit rate at 1 per cent. The report added that:
Inflation in Canada is close to 2 per cent as temporary factors that have been weighing on inflation have largely dissipated, as expected. In Canada, GDP growth in the first quarter was weaker than the Bank had expected, but should rebound in the second quarter, resulting in 2 per cent average growth in the first half of 2018.
USD/CAD Technical Analysis
The US dollar formed a decent support near the 1.2520-30 area against the Canadian Dollar. The USD/CAD pair bounced sharply and traded above the 1.2550 and 1.2580 resistance levels to settle above the 100 hourly simple moving average.
During the upside move, there was a break above a connecting bearish trend line with resistance at 1.2590 on the hourly chart of USD/CAD. The pair traded close to the 1.2660 level where it faced a strong selling interest.
The pair is currently correcting lower and testing the 1.2620 support along with the 38% Fib retracement level of the last wave from the 1.2548 low to 1.2659 high. However, there is a strong support at 1.2600 and the 50% Fib level of the stated wave.
Therefore, if the pair corrects lower further, it is likely to find buyers near the 1.2600 level in the near term.Tags: Canadian Dollar, US Dollar, USD/CAD, USD/CAD Technical Analysis