FxWirePro: USD/CAD trades weak on BOC rate hike, good to sell on rallies

• CAD has been trading higher against all majors yesterday after BOC hikes interest rates. USD/CAD hits low of 1.23650 and shown a minor recovery. The pair’s recovery was mainly due to uncertainty about the future of NAFTA. The pair jumped till 1.24685 and is currently trading around 1.24560.
   
• BOC hikes interest rates by 25bpbs to 1.25% and mentioned that rate hike  was mainly due to upbeat jobs increase and low unemployment rate since 1976. But next hike of rate depends on NAFTA talks . Any failure in NAFTA agreement will affect the pace and timing of the central bank’s next move.  
   
• Crude oil price shown a minor recovery after threat of Nigeria attack and declining inventories.The commodity jumped by 70 cents from the low of $63.29.
   
• Technically, major short term support is around 1.2435 and any break below will drag the pair till 1.23550. Short term bullish invalidation below 1.23550.
   
• On the higher side, near term major resistance is around 1.26000  and any break above will take the pair to next level till 1.2638 (daily Kijun-Sen)/1.27070 (61.8% retracement). Short term bearish invalidation only above 1.2925.  The minor resistance is around 1.2495 (10- day MA).

It is good to sell on rallies around 1.2525-30 with SL around 1.2600 for the TP of 1.2350/1.2300.