The Bank of Canada rate decision could push the USD/CAD decisively into a new trading range. Economists at Scotiabank highlight the key breakout points for the pair.

CAD awaits BoC's Decision for next move

“A 25 bps hike and balanced statement should give the CAD a modest lift – considering that swaps have been (and remain) reluctant to fully price in this tightening; USD/CAD could test the upper 1.32s/low 1.33 zone. A more dovish outcome – no hike – will see spot move quickly higher to test the recent peaks around 1.3500/20 at least.”

“Technically, the short-term charts highlight key break-out points for USD/CAD in the short run – above 1.3415, which will prompt a retest of the 1.35 area (last week’s high) or below 1.3325 which should prompt USD losses to the 1.3275 area.”

See – BoC Preview: Forecasts from eight major banks, edging towards a final rate hike