At yesterday’s meeting, the Bank of Canada left its key interest rate unchanged at 0.5%. At the same time, Canadian GDP growth estimate for 2016 and 2017 was lowered. Furthermore, inflation is going to remain below its 2% target until 2017 and the regulator will tend to continue with monetary policy easing to support its growth.
Today attention needs to be paid to Initial Jobless Claims for the last week of October in the US, the number of which could grow by 10 thousands, and August Retail Sales data from Canada (forecasted growth by 0.1%). Also, pay attention to the ECB Monetary Policy meeting in the eurozone.
Yesterday the pair grew to the level of 1.3140 (23.6% Fibonacci correction) after it fell to 1.2965 (38.2% correction) in the beginning of the week. A breakout of this level would resume an upward trend in the pair and send it towards recent highs at 1.3400.
At the same time, a breakdown of the levels of 1.3070, 1.3090 (ЕМА200, ЕМА144 on the 4-hour chart) would send the pair toward 1.2965.
On the daily chart, OsMA and Stochastic recommend long positions, while on the 4-hour chart the indicators start turning to sales.
- Support levels: 1.3070, 1.3010, 1.2965, 1.2910, 1.2875, 1.2820.
- Resistance levels: 1.3140, 1.3220, 1.3260, 1.3300.