Last week in Canada the index of business activity was worse than the forecast, moreover, the negative statistics on the number of building permits and the of construction of new houses were released. On the other hand, pessimistic data was balanced by the speech of the head of the Bank of Canada Stephen Poloz, who assessed positively the Canadian economy? and by the figures from the labor market, which turned out to be better than the forecast. The fall in oil quotes over the past two weeks weakens the Canadian dollar and in the dynamics of the pair USD/CAD is expressed as a flat with the range of 100 points: between the levels of 1.3410 and 1.3510. The lower limit of the black channel on H4 serves as and also has been working as an uptrend line for three months.
In the first half of this week there are no releases from Canada. The main impact on the movement of the pair will be investors' reaction to the decision of the US on the interest rate on Wednesday, June 14, at 20:00 (GMT+2).
Today from the important news traders should pay attention to the data from the US at 19:00 (GMT+2) the auction of 10-year treasury notes and at 20:00 (GMT+2) the report on the implementation of the US federal budget – the forecast involves an increase in the budget deficit by more than 80 billion US dollars.
Most likely, before the decision of the Fed, investors' activity will not be enough to change the trend, therefore in the next two days, we expect the consolidation of the pair.
Support levels: 1.3510, 1.3580, 1.3640, 1.3710.
Resistance levels: 1.3410, 1.3380, 1.3300, 1.3220.
Short positions can be opened at the market price with targets at the levels of 1.3410, 1.3380 and a stop loss at 1.3500.
Alternative scenario: long positions from the level of 1.3510, targets – 1.3580, 1.3640, stop loss – 1.3450.
The implementation period is two to three days.