USD/CAD: Loonie Remains Under Increased Pressure, Could Fall Further on Dovish BoC

Technical analysis of Forex market

The pair maintains firm bullish tone and extends advance from last Friday (daily gains of nearly 1%) above 1.33 barrier, to threaten retest of 14 Feb recovery high (1.3340) and attack at daily cloud base (1.3355).

Sentiment for loonie remains negative, following downbeat Canada’s GDP data which signal economic growth stall and could have negative impact on BoC policy decision on Wednesday.

Tones from the central bank’s policymakers were until now rather optimistic, keeping alive hopes for rate hike in the near future, bit strong signs of Canada’s slowing economy could put these plans on hold.

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More dovish comments in light of most recent data could increase pressure on Canadian dollar, as initial bullish technical signal would be generated on close above broken Fibo barrier at 1.3296 (38.2% of 1.3664/1.3068) and confirmation could be expected on lift above daily cloud that would open way for further correction of 1.3664/1.3068 fall.

Res: 1.3340; 1.3355; 1.3366; 1.3395
Sup: 1.3275; 1.3255; 1.3226; 1.3204

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