On Wednesday, the commodity currency CAD trade sideways against its U.S. counterpart as traders awaits the CPI data from Canadia. Lately, Canada’s vulnerable energy sector, a housing retardation and global trade pressures are pressing on business sentiment and the Canadian dollar.
Right now, the USD/CAD stay in features because of the forthcoming inflation report. In March, the CPI came at 0.7%, beating February’s CPI figure of 0.1%. The CPI rate of 0.7% is on the tickets now.
As you can see in the chart below, the USD/CAD trading sideways in a broad trading range of 1.3390 – 1.3300. Investors are looking for a reason to trigger a breakout, and I believe the Canadian inflation rate can become that reason.
The weaker inflation report strongly suggests the BOC will be on hold through the rest of this year. Odds of a rate cut by December multiplies in case the Canadian inflation rate misses the target.
Key Trading Level: 1.3369
The Stochastic value is under 50 while the USD/CAD is also trading below all the exponential moving averages like 20, 25 and 50 periods EMA. On the upper side, the violation of bullish breakout can lead USD/CAD towards 1.3445. While support prevails at 1.3250.
Consider doing choppy trading buy sell at top 1.3396 and buying at 1.3300. All the best!