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Market View

USDCAD goes "Loonie" again

Thursday, January 19, 2017 4:17 AM GMT

USDCAD was the most active currency pair yesterday. The “Loonie” had a sharp upmove, more than 1%, as BoC kept the option open to cut interest rates. If the risks the country is facing, are realized they move forward. Naturally, BoC’s hot topics remain: Trump effect and trade policy.  

Let’s review few statements of BoC’s Governor Stephen Poloz:

“A rate cut remains on the table and it would remain on the table for as long as downside risks are still present.”
“The Bank remains concerned by global uncertainty, which it views as 'undiminished' – particularly as it relates to the United States”

Additionally, Yellen’s comments were enough to support USD even if analysts said that the speech was vague. She is expecting rates to rise “a few times a year” through 2019 as well as said that the central bank is approaching its employment and inflation targets.

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Technical View:

Reviewing USDCAD on daily timeframe, price remains above 200 SMA so the long-term bias remains upwards. However, 200 SMA is flatting so bulls need to be cautious.  The 50 EMA may act as resistance and next major zone is around 1.335 to 1.338. There are no bullish crossovers on our short-term MAs ( 5 – 20 – 50) so possible selling opportunities may occur.

USDCAD daily


(EMA = Exponential Moving Average, SMA= Simple Moving Average
5EMA=Purple, 20 EMA=Gold, 50 EMA=Green, 200SMA= Blue)

Heading lower on hourly timeframe, the trend is extremely bullish and we had noted the basic upward crossovers. The grey zones can offer descent support following the immediate trend bias. In addition, you can see the double bottom that worked great (yellow areas).

USDCAD Hourly


(EMA = Exponential Moving Average, SMA= Simple Moving Average
5EMA=Purple, 20 EMA=Gold, 50 EMA=Green, 200SMA= Blue)

See below our post and chart on twitter reviewing the USDCAD:

 


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