Canadian Dollar strengthens broadly today, partly helped by rebound in oil price. And probably more importantly, BoC is widely expected to keep interest rate unchanged at 1.75% this week. Recent data showed much resilience in the economy, offering the central bank more room to take a wait and see mode and assess the economic developments. While the upcoming statement could be similar to prior meeting, there is also room for BoC to turn more “neutral”. Suggested reading: BOC Preview – Not Following Fed’s Footstep
CAD/JPY’s rise from 79.97 extended further to as high as 83.21 so far today. The strong support from 55 day EMA affirmed near term bullishness. Corrective fall from 85.23 should have completed at 79.97, just ahead of 61.8% retracement of 76.61 to 85.23 at 79.90. Near term outlook will stay bullish as long as 82.03 support holds. CAD/JPY have a test on 85.23 resistance next.
EUR/CAD is also extending the medium term down trend from 1.6151 as hits as low as 1.4636 so far today. As long as 1.4862 support turned resistance holds. The cross should target medium term projection level at 100% projection of 1.6151 to 1.4759 from 1.5645 at 1.4253.
