FxWirePro:USD/CAD loses momentum but bullish setup remains

• USD/CAD initially gained but gave up ground   as investors assessed U.S. inflation data and its impact on monetary policy outlook.

•U.S. consumer prices rose modestly in April, marking the smallest annual gain in four years, though the inflation outlook remains uncertain amid ongoing tariff pressures.

• U.S. consumer prices rose moderately in April, up 0.2% after a 0.1% decline in March, with inflation expected to accelerate in the coming months due to tariff-driven increases in import costs.

• Traders are now pricing in 56 basis points of rate cuts for this year, down from over 100 basis points projected in April amid peak concerns over Trump’s tariffs.

• At GMT 15:38,  the dollar was trading down 0.02 percent  at 1.3971 against Canadian dollar.

• Immediate resistance is located at 1.4022 (38.2%fib), any close above will push the pair towards 1.419(23.6%fib).

• Support is seen at 1.3948 (50%fib) and break below could take the pair towards 1.3878(61.8%fib).

Recommendation: Good to buy around 1.3950, with stop loss of 1.3870 and target price of 1.4050