USDCAD Downside Threat into Bank of Canada Governor Speech

Technical Analysis

On Tuesday 28th April, Bank of Canada (BOC) Governor Stephen Poloz is due to speak at the House of Commons in Ottawa, from 08.45 a.m. ET. Given recent speculation as to both the state of the economy and the direction of interest rates, this has potential to have a notable influence on the USDCAD exchange rate.

USDCAD Bearish Risks

The Friday push down through recent rebound support at 1.2176 and the Monday push below 1.2083 reinforces a negative view.

Moreover, the mid-April plunge through the 1.2385/61/52 chart support area signalled a top and a more bearish theme for downside extension.

For Today:

  • We see a downside bias for 1.2062; break here aims for 1.2000/1.1990 and 1.1965.
  • But above 1.2178 opens risk up to 1.2200, maybe 1.2238, which we would look to try to cap.

Short/ Intermediate-term Outlook – Downside Risks:

  • We see a more negative tone with the bearish threat to 1.2062.
  • Below here targets 1.2000/ 1.1990 and 1.1803.

What Changes This? Above 1.2571 signals a neutral tone, only shifting positive above 1.2667.

Momentum: The 8-day RSI, short-term momentum is falling and has scope to go still lower this week.

Risk Statement: Trading Foreign Exchange on margin carries a high level of risk and may not be suitable for all investors. The possibility exists that you could lose more than your initial deposit. The high degree of leverage can work against you as well as for you.