BoC Holds Steady: CAD/JPY Reacts with Minor Sell-Off

CAD/JPY  showed a minor sell-off after the BOC monetary policy. It hit an intraday high of 105.29 and is currently trading around 104.49.

The Bank of Canada (BoC) has opted to keep its main overnight interest rate at 2.75% in June 2025, citing substantial uncertainty about US trade policy, particularly following the US imposed doubled tariffs on Canadian steel and aluminum imports. Although the Canadian economy exhibits some resilience and unexpectedly strong recent inflation statistics, the BoC is taking a careful, data-dependent approach because of muted domestic demand, poor manufacturing job numbers, and dropping business confidence brought on by trade ambiguity. Governor Tiff Macklem stated that if tariffs worsen the economy and inflation pressures stay under control, a rate cut could be taken under consideration as the central bank gives stability first priority and carefully monitors incoming data before making any policy changes.

Technical Analysis

CAD/JPY is currently trading above the 34- and 55-EMA on the 1-hour chart. The immediate resistance is at 105.30; a breach above this level could shift targets to 105.51/106/107/108.25. On the lower side, near-term support is at 104.30,and a break below this support could lead to declines toward 103.85/103/102.50/10.65/101/100.

Indicator Trends

 CCI (50)- Bullish

ADX (14)-  Neutral

Trading Strategy Recommendation

It is good to sell on rallies around 104.78-80 with a stop-loss at 105.65 and a target price of 102.