Sees higher growth but inflation to lag. Says will be more cautious about future rate hikesThe Bank of Canada raised their growth forecasts for 2017 and 2018 but said inflation would take longer to pick up toward the 2% target (sees 2H of 2018). They also said that they would be more cautious about raising rates in the future. That has the USDCAD racing higher.
Looking at the daily chart, the price is moving away from the 100 day moving average at 1.2648. The pair has traded as high as 127749. That is just short of the August high of 1.2777. So as it stands right now there is a double top against the August and now October high. A break above will target the September 2016 high at 1.28207.
The surge higher took the pair up about 144 pips from the low to the high. The 38.2% of that surge higher comes in at 1.2720. That is near the earlier high from earlier in the day (see 5 minute chart below). If the bulls are to keep the fire burning today — and the double top hold — that level will be eyed as support.
A break above the double top should solicit stops and another run higher.