The Bank of Canada will release its interest rate today accompanied by statements from the Governor. Traders and investors usually place more interest on the statement that rate release data. After price corrects a leading diagonal upside. Will the bears resume or the bullish move will be strengthened? We give you important technical view based on 1 March USDCAD Elliott wave analysis.
01 March, AtoZForex – The Bank of Canada holds its second meeting of the year. It’s expected to keep the overnight interest rate unchanged. In the last meeting in January, the Bank spoke with optimism and CAD rallied amid fresh crude oil rally expectations. The BOC is expected to keep the rate unchanged at 0.5%. More important is the statement which the market will read much meaning to. The tone, optimistic or otherwise, usually drives prices up or down. Since mid-February, the USDCAD has been rallying after completing a leading diagonal Elliott wave pattern.
In the last update , we expected price to rally to 13350 after a brief dip.
1.3350 is the marked price for price to corrects the diagonal. There is a good likelihood that the correction will continue upside to complete at 1.3350 and its neighborhood.
Price is presently close to1.3350-1.3375. Further rally to the level could be seen before price fall especially if the BOC outcome is bullish for the CAD. The chart below shows our latest wave count.
It is very important to note price’s reaction to this region. Technically, a bearish reversal is to drive an impulse wave down below 1.29. The rate decision and statement will have an effect on this. It will be proper to wait till after the event before making a decision.
1 March USDCAD Elliott wave analysis: intraday view ahead BOC
The chart below shows the intraday forecast of the USDCAD before the BOC statement today.
If the rate statement is optimistic for CAD, the bearish resumption will be triggered. A break below the rising trendline in the chart above or below 1.3275 would be a good technical confirmation. An otherwise pessimistic tone will drive price further upside and the bulls can hold on to enjoy the ride.
Do you have other views in contrast to the ones listed or you want to compliment them further? let’s know by your comment below.
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