USDCAD has rallied to a two-month high of 1.2779 with relative yield differentials having broken favorably for the U.S. dollar following the testimony of new Fed Chairman Powell, yesterday. Read on as more details are discussed in the Post-Powell Testimony USDCAD Technical Analysis.
28 February, HotForex – Powell’s optimistic tone, along with his emphasis on fiscal policy stimulus, raised the odds for a more aggressive rate stance, with the possibility of four quarter-point hikes in the fund’s rate, rather than three, now being entertained by Fed watchers. In contracts, the OIS market was yesterday discounting no more than 50% odds for the BoC to hike rates in April.
The next Canadian data of note will be January industrial product prices later today, where expectations are for a 0.5% m/m gain. Q4 current account and December and Q4 GDP data are also due this week, on Thursday and Friday, respectively. The NAFTA renegotiation remains a font of uncertainty for the Canadian economy.
Post-Powell Testimony USDCAD Technical Analysis
Let the trend be your friend. The pair’s technical bull trend credentials, in evolution since early February, are strong, higher highs and higher lows, a rising RSI momentum indicator (14 day), which is strengthening while still being short of “overbought” levels.
Additionally, the key 50-day moving average was breached on the 20th and yesterday the even more significant 200-day moving average was breached and broken. Next stop is the weekly resistance at 1.2820area with support at 1.2720 and 1.2680.
This article about Post-Powell Testimony USDCAD Technical Analysis was written by Andria Pichidi, Market Analyst at HotForex. The provided article is a general marketing communication for information purposes only. It does not constitute an independent investment research. Nothing in this communication contains an investment advice or an investment recommendation. It also does not contain a solicitation for the purpose of buying or selling of any financial instrument.
All information provided gathered from reputable sources. Any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. We assume no liability for any loss arising from any investment made based on the information provided in this communication.