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USD/CAD breaches 1.1150

FXStreet (Edinburgh) - The greenback continues to depreciate vs. its fellow neighbor on Wednesday, dragging USD/CAD to test multi-day lows around the mid-1.1100s.

USD/CAD all eyes on the Fed, Poloz

Undoubtedly, the FOMC gathering will take centre stage today, with investors expecting the Committee to announce the end of the bond-buying programme started two years ago. Despite there will be no press conference or report on economic projections, the core of the debate will gyrate around the wording regarding the current ‘forward guidance’, amidst speculations on the timing of the first rate hike by the Fed. Following the FOMC statement, the other relevant event for the pair will be the speech by Governor S.Poloz, with consensus currently expecting a dovish tone. According to Shaun Osborne, Chief FX Strategist at TD Securities, “a dovish surprise from the FOMC may see funds test the low 1.11s (200-day MA at 1.1123). That has been a pretty good zone of support/resistance for USDCAD in the past few months and, with Poloz speaking later in the day and likely to sound dovish, USDCAD weakness should find some traction around 1.1115/25”.

USD/CAD significant levels

At the moment the pair is retreating 0.20% at 1.1144 with the next support at 1.1093 (38.2% of 1.0620-1.1385) followed by 1.1082 (low Oct.9) and then 1.1071 (low Oct.2). On the upside, a break above 1.1224 (Tenkan Sen) would target 1.1255 (high Oct.27) en route to 1.1263 (high Oct.23).

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