CAD/USD And EUR/USD
Posted by FreeWithForex on June 29, 2023
- - The Canadian Dollar continues to grow this Week as the Bank of Canada (BoC) is Predicted to Increase Rates next month
- - Bank of Canada overview Projections shows the issues concerning the price volatilities and the Labour market
- - The inflation to be released this week will increase the price of CAD
- - CAD/USD Support and Resistance levels to look out for
- - ECB officials offer an aggressive catalyst for the Euro
- - What to expect from EUR/USD?
Canadian Dollar Backdrop
The past couple of weeks has seen the Canadian Dollar give an amazing run against the US Dollar. The past weeks have been impressive, and this is coming after the fall of oil prices.
The last couple of weeks have seen traders ignore the Bank of Canada (BoC), and focus more on the other Major Central Banks and their rate hikes for the remainder of 2023. Last week brought about the reviews from the June meeting which introduced the disputes regarding rate hikes that took place in June and also indicated a possible hike in July. The Central Bank had shown shock over the resilience of the economy with consumer consumption coupled with price pressure still obvious across the economy.
The end of the week will give insight into the Canadian GDP for May. Traders predict that this will help gauge the predicted hike in July, as most traders predict an additional 25bps hike in July. The Average weekly yields will offer additional hints about the pressure being fueled by inflation. This is evident in the labour market. An increase in inflation and weekly earnings reports will help the Canadian Dollar. This is because rate hikes will face aggressive price pressure.
CAD/USD has been bearish since the morning, this is coming after the little attempt at a bullish trend on Friday. The daily bar closed as an inverted hammer, which signals a possible bullish trend. However, this trend is yet to be confirmed.
However, traders are still holding out in a possible bullish reversal. Primary resistance is resting at 1.3250, traders are skimming for CAD/USD to break the 1.3320 resistance level.
On the other hand, a preceding bearish trend will plunge support to the 1.3000 level. If prices go lower, a new support level will be formed at 1.2750, which is the low attained in August 2022.
EUR/USD
The EUR/USD was bullish on Tuesday, despite the aggressive rate hikes from the ECB. However, the US Dollar is still the same despite the upbeat US economic data.
ECB Officials offer An Aggressive Catalyst For the Euro
The ECB forum on Central banking is to be held at Sintra Portugal. All the Major central bankers from the world's biggest banks will be at the forum. In attendance will be the heads of the Fed, Bank of England, Bank of Japan and the ECB president. The market is always affected when one of the heads of the above central banks makes news, traders are highly anticipating the reviews from tomorrow's forum.
This Morning, President of the Bank of Latvia indicated that interest rates will rise after July and he flatly dismissed the anticipation of rate cuts in 2024.
The Fed and ECB still have a great effect on EUR/USD. Jerome Powell making a statement last week in regards to the aggressive rake hikes approach has propelled the pair to trade downwards.
What To Expect From EUR/USD?
With the rate hikes cycle gradually coming to an end, markets are becoming more volatile. The news flow seems to have a greater effect on the markets. This could lead to more downward trends and more range-bound trades, which will allow traders to enter at a previously high-priced trades.
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