USD/CAD breaks to a 9-month low, 1.3000 in focusCanadian consumers want to have their inflationary cake and eat it, with a hot retail sales report bolstering bets that the BOC could hike again at their next meeting in July. Whilst a hike is not yet a given, the BOC did deliver a hawkish hike earlier this month - and with consumers continuing to spend, it keeps the pressure on the BOC for further hikes.
Yet a weaker USD - seemingly on the back of Jerome Powell's testimony not being hawkish enough - helped USD/CAD break to a 9-month low.
The daily chart shows that is closed near the lows of the day after falling through a major zone of support. It's interesting to see the daily low found support at the September VPOC (point of control), so perhaps we'll see a minor bounce before losses resume in the direction of the breakout.
The bias remains bearish beneath 1.3270, but we'd prefer to seek bearish setups o lower timeframes beneath Tuesday's low to increase the potential reward to risk ratio
But if bears maintain their grip on USD/CAD, a break to new lows brings the 1.3000 handle into focus over the coming weeks.
