USD/CAD could rebound from its support at 1.2820, but the ECB could prove decisive
USD/CAD is coming back close to important short-term support at 1.2820, but the short-term rally could depend on the ECB this afternoon. A more hawkish than expected ECB, for example by raising rates by 50 basis points, would put pressure on the greenback, which could temporarily push the USD/CAD below 1.2820. Conversely, an unsurprisingly hawkish ECB could allow USD/CAD to rebound to its recent high at 1.32 and then its September 2020 high at 1.34.
The outlook would turn technically bearish in the short term if it pulls back below 1.28. In this case, it will be preferable to wait for a decline to the long-term bullish slant which notably passes through the troughs of April and June of this year to seek to position oneself for the purchase in the direction of the underlying trend.
Entry: Buy between 1.2820 and 1.2870
Objective: 1.32, then 1.34
Risk/reward ratio: >3
Follow the evolution of the USD/CAD price with IG.