USD/CAD has been quite bullish recently which is currently quite corrective and showed some bullish rejections off the 1.2800-50 resistance area. USD has been positive with the economic reports which helped the currency to gain momentum against CAD. Today is going to be a volatile day for CAD as the GDP report is going to be published which is expected to have a slight increase to 0.1% from the previous value of 0.0%. Along with the GDP report, Canada's RMPI report is expected to be published with a decrease to 0.4% from the previous value of 1.0%, while the IPPI report is expected to increase to 0.5% from the previous value of 0.3%. Additionally, Bank of Canada Governor Poloz is going to speak today about short-term interest rates and future monetary policies which is expected to be hawkish in nature. On the USD side, today the US Employment Cost Index report is going to be published which is expected to show an increase to 0.7% from the previous value of 0.5%, S&P/CS Composite-20 HPI report is expected to be unchanged at 5.8%, and the Chicago PMI report is expected to decrease to 60.2 from the previous figure of 65.2. Besides, the CB Consumer Confidence report is expected to show an increase to 121.1 from the previous figure of 119.8. Ahead of the Fed rate decision on Wednesday which is expected to be unchanged at 1.25% the currency is expected to be quite neutral in nature. As of the current situation, CAD is expected to have an upper hand over USD if Canada's GDP report comes as expected or better than expected today. This week is going to be very volatile for the USD based pairs as the FOMC meeting, the Federal Funds rate, Non-Farm Payroll, Average Cash Earnings and Unemployment Rate reports are going to be published which is expected to show the upcoming directional bias of the market and unfold the next moves.
Now let us look at the technical view. The price is currently residing inside the resistance area of 1.2770-1.2850 ahead of the GDP report and BOC Gov Poloz's speech. The pair is expected to show an impulsive bearish move towards 1.2450 if the price breaks below 1.2770 with a daily close today. As the price remains below 1.2850, the bearish bias is expected to continue further.
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