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USD/CAD edging lower as Bank of Canada decision draws closer

Ahead of the US ADP employment report, at 1.15pm GMT, the USD/CAD has been falling back from an earlier European session high at 1.3589. It did reach a high of 1.3595 during the Asian session after closing in the US at 1.3592. The US dollar has now fallen back to around 1.3559 a short while ago. So, at 3pm today the Bank of Canada (BOC) will most likely sit on their hands and keep the OCR rate at 5%. That is not an  entirely guaranteed outcome of course, but it does seem the most likely. If that is the case then much of how the USD/CAD reacts to the outcome could rest with whatever statement and rhetoric accompanies the decision. Since dropping below its 200 day moving average (now at 1.3517) last week, the US dollar has been on the rebound, but as noted here earlier, the 1.36 handle has remained elusive so far. However, should the US dollar extend beyond that, there is minor resistance at 1.3627 and then the current 21 day moving average, right now in place at 1.3668. On the downside a break below that 200 day moving average would give rise to potential for a test of the lows seen last week. The USD/CAD is currently trading at 1.3563 
 

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