FxWirePro: USD/CAD hits- 2-month high on weak oil price, markets eye BOC monetary policy

• USD/CAD hits 2 –month high at 1.30468 after breaking 1.3000 yesterday from low of 1.27496 almost 300 pips on account of huge decline in oil prices. Market eyes BOC monetary policy which his to be released today for further direction. It is currently trading around 1.3000.
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• BOC is expected to keep its interest rates unchanged at 1.25% as NAFTA and US trade war will affect the Canadian economy. Canada’s household debt to disposable income stood near record high in the fourth quarter of 2017. Any drastic increase in interest rates will affect the household and consumption will be under pressure. CPI data came two weeks before shows that headline inflation in Apr grew by 2.2% slightly less than forecast 2.4% but slightly above 2.0% mark and wage growth at 3.6% much more than inflation.
   
• WTI Crude oil prices has shown a huge decline of more than $7 from the high of $72.65 after Saudi Arabia and Russia discussed easing supply curbs  and they may increase supplies. It hits low of $65.78 and is currently trading around $66.93.
   
• Technically near term resistance is around 1.3050 and any convincing break above targets 1.3080/1.3125.Major bullish continuation only above 1.3125.
   
• On the lower side, near term support is around 1.2945 and any convincing break below will drag the pair down till 1.28850 (23.6% fibo)/1.2850 (7- day MA)/1.2800. the minor support is around 1.28500.

It is good buy on dips around 1.2995-1.3000 with SL around 1.2955 for the TP of 1.3120.