GBPCAD is still trading inside its range on the 4-hour chart, and price just bounced off the resistance. Another test of support could follow from here.
However, the 100 SMA is crossing above the 200 SMA to indicate that the path of least resistance is to the upside. Buyers could return right at this mid-range area of interest and spur another test of the top at 1.7150.
Stochastic seems to have room to head lower, so price could still follow suit. The oscillator appears to be making an upward crossover, though, so it could pull up before indicating oversold conditions or exhaustion among sellers. RSI is on middle ground to confirm the consolidation.
The BOC kept interest rates on hold at 0.25% as expected and maintained its current pace of asset purchases.
“We remain committed to holding the policy interest rate at the effective lower bound until economic slack is absorbed so that the 2 percent inflation target is sustainably achieved. Based on the Bank’s latest projection, this is now expected to happen some time in the second half of 2022,” the statement read.
Still, the Loonie was able to draw a boost from rising crude oil prices, as the EIA reported a larger than expected draw in stockpiles. This suggests that demand has picked up stronger in the past week, likely due to stronger demand for fuel and energy commodities from reopening economies.
Keep in mind that the OPEC+ reaffirmed its output deal, which eases global glut concerns for crude oil and keeps prices afloat.
There were no major reports due from the UK economy, but it’s important to note that the BOE is shifting slightly to a more hawkish tone as well. The central bank slowed the pace of its weekly asset purchases and might be poised to lower the overall target soon as well.