- The USD/CAD pair firmed on Tuesday as prices of oil fell and the greenback made broader gains, but losses for the loonie were limited ahead of an expected interest rate hike by the Bank of Canada on Wednesday.
- Chances of a hike on Wednesday sit at 88 percent, data from the overnight index swaps market shows. A nearly 80-percent chance of a second hike has been implied by December.
- Prices of oil, one of Canada's major exports, fell as global oversupply encouraged several banks to cut their forecasts for crude for this year and 2018.
- The pair remains under bears control unless until it trades below 1.3000 resistance level, therefore it is good to sell this pair on rally.
- To the upside, the strong resistance can be seen at 1.3000, a break above will take the pair towards next resistance level at 1.3041.
- To the downside strong support can be seen at 1.2859 levels, a break below will open the door towards next level at 1.2800.
Resistance Levels
R1: 1.3000 (50% Retracement level)
R2: 1.3041 (June 29th high)
R3: 1.3118 (61.8% Retracement level)
Support Levels
S1: 1.2859 (38.2% Retracement level)
S2: 1.2800 (Psychological levels)
S3: 1.2718 (23.6% Retracement level)
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