3 reasons USD/CAD should be lower. What’s next for the pair?

Still, USD/ CAD could move aggressively advanced in a hurry!
, If any of theses circumstancesreverse.USD/ CAD has been trading in a range since January 27th between1.2636 and1.2797, roughly 160 pips. That’s nice for dealers who like to range- trade. Still, there are several reasons that the brace should be trading lower. Below are a many of those reasons

CPICanada released CPI data before moment. Like so numerous other countries these days, the January affectation data was advanced thanexpected.Expectations are were for4.8YoY.However, the caption print came out at5.1 YoY. The Bank of Canada meets on March 2nd and prospects are for a 25bps rate hike (its first). With a rate hike on its way and affectation over 5, dealers may suppose the Canadian Bone should be stronger
. Canvas On January 11th USD/ CAD broke below the neckline of a head and shoulders pattern near1.2600. At the time, WTI Crude canvas closed near81.25. Moment, Crude canvas is trading in the92.00/95.00 area and USD/ CAD is advanced, near1.2700. Easily the Canadian Bone has n’t been following Crude Oil for the once month.
DXY On January 28th, the DXY made a high of97.44 and traded lower for 5 straightdays.Since that date, the DXY is lower by nearly1.75. USD/ CAD also made a near- term high on January 28th, but only pulled back for 3days.Since also, USD/ CAD is only down0.8. With the US Dollar Index down as important as it’s during the last many weeks, USD/ CAD dealers may thing USD/ CAD should be lower as well.
On a diurnal timeframe, USD/ CAD broke below the neckline of a head and shoulders pattern at1.2600 on January 11th and began moving towards its target of1.2250. Still, the move was baffled by several hammer candlesticks between January 13th and January 20th, which helped priced to reverse. USD/ CAD also went shot to the1.2797 high, negating the head and shoulders pattern. The brace has been trading in the preliminarily mentioned range since.

Since USD/ CAD is n’t pushing lower for the reasons given above, what happens if any of those themes change? What happens if the BOC does n’t hike and sees affectation decelerating? What happens if canvas reverses and moves lower. What happens if the DXY moves advanced? If any of these be, USD/ CAD could move aggressively advanced.
First resistance is at the January 11th highs of1.2797 also the January 6th highs at1.2814. Above there, USD/ CAD can run up to the highs of the head of the preliminarily mentioned head and shoulders pattern from December 20th, 2021 at1.2964. Long- term vertical resistance is just over there at1.2990. Still, support is at the February 10th lows of 1, If USD/ CAD eventually does break lower.2636. Below there’s vertical support at1.2570 and the 200 Day Moving Average at1.2532.

There are several reasons that USD/ CAD could be lower, but it’s not. Thus, if any of the below- mentioned circumstances reverse, USD/ CAD could move aggressively advanced in a hurry!

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