The Bank of Canada raised interest rates from 0.50% to 0.75% during yesterday BOC Rate Statement, hiking rates for the first time in seven years!
"Governing Council judges that the current outlook warrants today's withdrawal of some of the stimulus in the economy. Future adjustments to the target for the overnight rate will be guided by incoming data as they inform the Bank's outlook, keeping in mind continued uncertainty and financial system vulnerabilities."
With yesterday rate hike, it more or less confirmed our bias on USDCAD for the remaining of 2017. We will remain bias on this pair for the year!
That said, it doesn't mean we are shorting it right away, but for every retracement and correction to the upside, we will be seeing it as an opportunity to go for a short trade.
Looking at how price has developed since May 2017, a decent retracement to 1.2886 will present a good shorting opportunity. Shared with our traders on this, the impulse moves down for USDCAD can be quick and strong; and more importantly, it presents us with a very good chance to scale in for this pair.
*Again, this is not a trade call. Make sure you have a proper plan to engage the market and scale in accordingly.