Current trend

During the Asian session, the USD/CAD pair is strengthening, testing the level of 1.3575 for a breakout: after yesterday’s renewal of the highs of December 13, the “bulls” lost some of the gained positions.

Today at 20:00 (GMT 2), the results of a two-day meeting of the US Federal Reserve will be published: analysts do not expect a change in the parameters of monetary policy but are counting on renewed comments and forecasts since now, the most likely scenario is the first interest rate cut by 25 basis points during the June meeting. The American currency could receive a powerful boost to growth if regulators’ representatives indicate only two borrowing cost adjustments this year.

National macroeconomic statistics put additional pressure on the Canadian dollar: in February, the consumer price index increased by 0.3% after last month’s zero dynamics compared to expectations of 0.6%, as a result of which the indicator slowed from 2.9% to 2.8% YoY, while experts expected 3.1%, and core inflation fell from 2.4% to 2.1%. Thus, price pressures are easing faster than previously expected, which could increase the “dovish” sentiment among Bank of Canada officials.

Support and resistance

On the daily chart, Bollinger Bands are moving flat: the price range changes slightly, limiting the development of the “bullish” sentiment in the short term. The MACD indicator is growing, maintaining a strong buy signal: the histogram is above the signal line. Stochastic, having retreated from its highs, reversed into a downward plane, signaling in favor of a corrective decline in the ultra-short term.

Resistance levels: 1.3600, 1.3650, 1.3700, 1.3750.

Support levels: 1.3550, 1.3525, 1.3500, 1.3450.

Trading tips

Long positions may be opened after a breakout of 1.3600, with the target at 1.3700. Stop loss – 1.3550. Implementation time: 2–3 days.

Short positions may be opened after a rebound from 1.3600 and a breakdown of 1.3550, with the target at 1.3450. Stop loss – 1.3600.