USDCAD, H1
USDCAD has lifted back above 1.3500, swinging the five-month high seen in late April at 1.3521 back into range. The move has been concomitant with a rekindling of the risk-off theme in global markets, which has seen the US Dollar’s safe haven premium gain momentum while weighing on crude prices. The pair remains bullish, trading over the 20-day moving average, on the assumption that the global economy is set for a rocky patch and associated risk for a sustained correction in oil prices. USDCAD is presently challenging recent range highs in the 1.3493-1.3521 zone, which collectively mark a key resistance zone. Support comes in at 1.3450 and 1.3400.
The BoC’s monthly review of monetary policy is widely expected to be a non-event for markets. No change to the current 1.75% rate setting is anticipated, with the central bank firmly in wait-and-see mode amid a recovering economy on the one hand, and the uncertainty over the USMCA and the wider geopolitical situation on the other.
Stuart Cowell
Head Market Analyst
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