Corrects from 1.3800 as US Dollar’s rally stalls ahead of Fed’s decision
The post Corrects from 1.3800 as US Dollar’s rally stalls ahead of Fed’s decision appeared on BitcoinEthereumNews.com.
USD/CAD trades cautiously ahead of US Inflation and Fed’s policy outcome The Fed is expected to leave interest rates unchanged for seventh straight time. The BoC could deliver subsequent rate cuts, given weak labor market conditions. The USD/CAD pair drops to 1.3740 in Wednesday’s European session after failing to recapture the round-level resistance of 1.3800 on Tuesday. The Loonie asset corrects as firm recovery of almost 1.40$ in the US Dollar Index (DXY) appears to be stalling due to uncertainty ahead of the United States (US) Consumer Price Index (CPI) data for May and the Federal Reserve’s (Fed) interest rate decision, which are scheduled in the North American session. US annual core CPI, which excludes volatile food and energy prices, is estimated to have eased slightly to 3.5% from April’s release of 3.6%, with headline figures growing steadily by 3.4%. The inflation data turning out to be stubborn would weaken market expectations for the Fed to begin reducing interest rates from the September meeting, while soft number would boost them. Meanwhile, investors will majorly focus on the Fed’s dot plot as the central bank is expected to remain status quo for the seventh straight time. The Canadian Dollar remains broadly on the backfoot as investors expect that the Bank of Canada (BoC) could deliver subsequent rate cuts to boost labor demand. Canada’s inflation has already declined into BoC’s preferred core CPI range of 1%-3%. USD/CAD strengthens after a breakout of the Descending Triangle chart pattern formed on a daily timeframe. Upward-sloping 20- and 50-day Exponential Moving Averages (EMAs) near 1.3700 and 1.3660, respectively, suggest that the overall trend is bullish. The 14-period Relative Strength Index (RSI) hovers near 60.00. A sustainable move above the same will push momentum towards the upside. Fresh buying opportunity would emerge if the asset breaks…
Filed under: News - @ June 12, 2024 11:14 am