USD/CAD Technical Analysis: Mildly bid in narrowing range despite oil rally
The USD/CAD pair is currently trading at 1.3360, representing a 0.11 percent gain on the day, even though oil is bid at 2019 highs. As of writing, the West Texas Intermediate (WTI) oil is trading within a striking distance from the 2019 high of $65.97 hit yesterday.
More importantly, the USD/CAD pair is still trapped in a narrowing price range or contracting triangle, as seen in the chart below.
Currently, the triangle resistance is seen at 1.3430, while the support is seen at 1.3304.
A triangle breakout, if confirmed, could be followed by a sustained rally above 1.3467 (March 7 high). On the other hand, the lows near 1.31 seen in the second half of February could come into play if the narrowing price range is breached to the downside.
The USD/CAD pair could breakout or breakdown from the trading range depending on what the Bank of Canada says later this week. The central bank is widely expected to maintain the status quo on policy rates and shift to a neutral stance from the hawkish bias.