The USDCAD fell to two-week low below 1.2600 handle despite Canadian inflation fell below expectations (July CPI 0.0% m/m vs 0.1% f/c / core CPI -0.1% in July vs 0.1% f/c) that may cool down expectations of BoC hiking rates soon. Loonie benefits from reduced risk appetite and may advance further on weak daily technicals as the latest acceleration broke through 20SMA (1.2603) after yesterday’s probe below 1.2600 handle was short-lived. The pair eyes next support at 1.2552 (Fibo 61.8% of 1.2413/1.2778 upleg) violation of which is needed to signal an end of 1.2413/1.2778 corrective phase. The pair is also on track for bearish weekly close after two consecutive bullish week, with strong bearish signal being generated from bearish weekly candle with long upper shadow that signals strong upside rejection. Broken 10 SMA at 1.2681 which caps today’s action, marks significant barrier.
Res: 1.2600; 1.2644; 1.2681; 1.2700
Sup: 1.2574; 1.2552; 1.2531; 1.2500
