Double Impact Ahead for the USD/CAD Market
Today, the USD/CAD market faces a “double impact” from major central banks:
→ At 16:45 GMT+3, the Bank of Canada is expected to announce a rate cut from 2.75% to 2.50%.
→ Later, at 21:00 GMT+3, the Federal Reserve will release its own rate decision.
Both announcements will include statements from the respective central bank chairmen regarding future monetary policy and economic outlooks, likely resulting in heightened volatility in the USD/CAD market throughout the day.
Technical Analysis of the USD/CAD Chart
Earlier this month, analysis of the USD/CAD chart highlighted the formation of a symmetrical narrowing triangle—a classic sign of balance between supply and demand—bounded by:
→ A long-term descending channel (red), in place since ahead February.
→ A short-term channel (blue), shaped by price movements since mid-summer.
At that time, it was suggested that the pair would remain in a temporary state of equilibrium until today. Since then:
→ The price reversed sharply from the upper boundary of the triangle (marked with an arrow).
→ Ahead of the key announcements, USD/CAD is attempting to consolidate below the lower boundary, indicating growing bearish pressure—essentially, a shift in balance favoring supply.
Key Observations:
→ The aggressive nature of the September support breakout (S).
→ The decline toward the critical 1.3725 level, which has acted as support since August.
Given these developments, the market appears to be leaning bearish. Today’s announcements could trigger a downward impulse in USD/CAD. From a chart perspective, this may manifest as:
→ A potential breakout of the formed by the short-term blue channel.
→ A resumption of the broader downtrend within the long-term red channel.
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