The Canadian dollar looks fix to pause its half-dozen-twenty-four hour period losing streak this calendar week every bit investors react to the Fed’s interest rate determination on Midweek, July 30th. The Fed was widely tipped to cutting interest rates past 25 ground points in an endeavour to induce the U.S. economic system inwards the face up of stiff headwinds affecting the global economy.
Canada Holds Steady
The act is inward stark contrast to the Bank of Canada which diverged from other major central banks earlier in July when it chose to go on the interest rate on concur.
The caput of the BOC, Stephen southward. Poloz, stated that the banking company had no immediate intention of easing monetary policy as well as left rates unchanged at ane.75 per cent. As a result, the charge per unit cutting by the Federal Reserve volition cause the U.due south. Dollar to weaken against the Canadian Dollar.
Strengthening Oil Prices Add To The Mix
Any act could be further amplified past rising fossil oil prices which proceed to strengthen on the dorsum of increased tensions inward the Middle East. The seizing of a British registered rock oil tanker past Iran threatens fossil oil supplies in the part which could position force per unit area on fossil oil prices over the coming weeks.
With oil being 1 of Canada’second leading exports, the Canadian dollar is heavily influenced past the brusk-term spot toll of fossil oil.
WTI Crude rock oil held support at $55.71 final calendar week earlier climbing to resistance at $57.15. Should that resistance level suspension this could live a perfect tempest for traders looking to net profit from short-term moves.
On Tuesday, July 30th the USD/CAD was belongings resistance at ane.31757. The Fed rate cutting could mean the U.south. dollar could fall back to the i.31276 level. If the oil toll breaks resistance it could movement USD/CAD to fall even farther to the ane.30281 level, concluding seen on 19th July.
As e’er investors should proceed a close eye on the word together with spotter for breakouts higher up primal support as well as resistance levels. While no trade is guaranteed, monitoring back up in addition to resistance levels around central events such equally the Fed monitory policy meeting tin atomic number 82 to profitable trades for sharp investors.