USD/CAD bearish trend is still quite intact but recently broke below the key support level of 1.2450. CAD has been quite dominating over USD after the rate hike decision was made last month whereas USD is quite weaker due to worse economic reports published recently. Today, the Bank of Canada is going to post the Rate Statement and the Overnight Rate report which is expected to be unchanged at 0.75%, Trade Balance report is expected to show less deficit at -3.2B from the previous figure of -3.6B and Labor Productivity report is expected to show a decrease to 0.9% from the previous value of 1.4%. On the USD side, today Trade Balance report is going to be published which is expected to show greater deficit at -44.6B from the previous figure of -43.6B, Final Services PMI report is expected to decrease to 56.8 from the previous figure of 56.9, and ISM Non-Manufacturing PMI is expected to increase to 55.8 from the previous figure of 53.9. To sum up, CAD is expected to gain ground with the economic reports whereas USD reports are expected to be rather weak. As of the rate decision of CAD, there are higher chances of rates being unchanged today whereas other economic reports of CAD being published today will contribute further with the gains. CAD is currently expected to gain further over USD in the coming days.
Now let us look at the technical chart. The price has recently broken below the key support level of 1.2450 which does signal further bearish pressure is going on. The impulsiveness of the bears is quite impressive in this pair whereas the trend has been non-volatile as well. As the price remains below 1.2700-1.2830 resistance area, the bearish bias is expected to continue further in this pair.
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