As the US dollar is grinding along a falling trendline, there is a chance of a breakout if the Bank of Canada convinces markets of its resolve to keep interest rates at a record low.
Price action has been building up support above 1.2570 in a rectangle-shaped consolidation. The narrowing range between the support and the resistance is typical of the market’s indecision ahead of a catalyst.
A close above 1.2700 on the daily trendline could prompt sellers to rush to cover their positions, fuelling a breakout rally.
