• USD/CAD advanced on Monday as Canadaian dollar dipped as investors assessed escalating U.S.-Iran tensions in the Middle East and a softer-than-expected domestic inflation reading.
• Canada's annual inflation rate cooled to 2.8% in June from a 29-month high of 3.2% in May, as gasoline costs fell sharply. Measures of underlying inflation closely watched by the BoC also eased.
•The Consumer Price Index on a month on month basis decelerated by 0.4%, Statistics Canada said.
• Last month, Canada's consumer price index rose to a 29-month high of 3.2%, exceeding the Bank of Canada's 3% upper inflation target for the first time in more than two years.
•The price of oil, one of Canada's key exports, slipped 0.4% to $82.16 a barrel. Optimism over renewed U.S.-Iran nuclear talks was tempered after Yemen's Iran-backed Houthis announced a naval blockade on Saudi Arabia.
• Immediate resistance is located at 1.4090(38.2%fib), any close above will push the pair towards 1.4151(SMA 20).
• Support is seen at 1.4018 (Lower BB) and break below could take the pair towards 1.3978(Lower BB).
Recommendation: Good to buy around 1.4060 with stop loss of 1.4000, and target price of 1.4120
