Given that the Canada's CPI (MoM) is expected to be negative, it showed that the previous rates hike did help in driving prices down. However, is this short term? I think we need to look into the details - the Canadian property prices as well as commodities, oil in particular, to see if the prices for these two are down. Therefore, we ought to pay greater attention onto the Core CPI, to see if the behaviour is somewhat similar that of the US.
If prices are indeed down, the Canadians might not be pressured to raise rates any further unlike the US on Thursday. Therefore, I am long this currency pair and expected to break out of this existing channel.
On the technical front, MACD shows it being overpriced, so does RSI. In terms of bollinger bands, it is between the one and two S.D, therefore, I wouldn't suggest getting in now but probably wait till Tuesday whereby I am expecting a reversal after the Canada's CPI news. Then, I would buy the dip.
If prices are indeed down, the Canadians might not be pressured to raise rates any further unlike the US on Thursday. Therefore, I am long this currency pair and expected to break out of this existing channel.
On the technical front, MACD shows it being overpriced, so does RSI. In terms of bollinger bands, it is between the one and two S.D, therefore, I wouldn't suggest getting in now but probably wait till Tuesday whereby I am expecting a reversal after the Canada's CPI news. Then, I would buy the dip.