• USD/CAD strengthened on Friday as Canadian dollar was weighed by downbeat GDP data.
• Canada’s economy unexpectedly contracted for a second straight quarter amid uncertainty over U.S. tariffs.
• Canada’s GDP fell at an annualized 0.1% rate in Q1 after a revised 1.0% contraction in Q4, Statistics Canada said Friday.
• Canada’s economy has largely weathered trade uncertainty and tariff pressures for more than a year, but the broader impact has weakened investment, hiring and spending while pushing prices higher.
•Investors are now pricing in one Bank of Canada rate hike this year, down from two expected before softer inflation data.
• Immediate resistance is located at 1.3836 (50%fib), any close above will push the pair towards 1.3865(Higher bb).
• Support is seen at 1.3776(38.2%fib) and break below could take the pair towards 1.3732 (SMA 20).
Recommendation: Good to buy around 1.3780, with stop loss of 1.3700 and target price of 1.3830
