USD/CAD has been quite corrective this week having no directional pressure while residing in a bullish trend inside a range of 1.2660 to 1.2900 area. Today is going to be very interesting and volatile for USD as the most anticipated Federal Funds Rate Hike report is going to be published which is expected to show an increase to 1.50% from the previous value of 1.25%. This increase in the interest rate value is expected to well contribute to the upcoming growth of USD against CAD in the coming days. Along with the Interest Rate report on the USD side, CPI report is going to be published which is expected to increase to 0.4% from the previous value of 0.1%, Core CPI report is expected to show an unchanged value of 0.2%, Crude Oil Inventories is expected to show less deficit at -3.6M from the previous figure of -5.6M and FOMC Press Conference is going to be held just after the Rate Hike decision which is expected to be quite hawkish in nature to support the gains of USD in the coming days. This week, there was nothing quite important going on the CAD side but on Thursday CAD NHPI report is going to be published which is expected to be unchanged at 0.2%, Bank of Canada Governor Poloz is going to speak about the upcoming policies to be applied which are expected to be quite neutral in nature showing no promise of further growth of CAD in the short-term and on Friday Manufacturing Sales report is going to be published which is expected to increase to 0.9% from the previous value of 0.5%. As of the current scenario, USD is expected to gain good momentum over CAD as the Rate Hike is quite imminent and better economic report forecasts which are expected to lead to further bullish pressure in the pair. This week CAD does not have much to offer in the economic reports to hold the gains of USD which will result in the good dominance of USD over CAD in the coming days.
Now let us look at the technical view, the price is currently residing at the edge of resistance area 1.2900 which is expected to break above with a target towards 1.3200 in the coming days. The price has been quite impulsive with the bullish gains which did help the price to head over the dynamic level of 20 EMA indicating a bullish pre-breakout structure. As the price remains above the range support of 1.2660 the bullish bias is expected to continue further.
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