The Bank of Canada cut rates by 25 basis points as expected, and the USDCAD initially moved higher in response, reflecting a weaker CAD. The move carried the pair above its 100-day moving average at 1.37623, with the rally stalling at a session high of 1.3769 before momentum faded.
Since then, the pair has rotated lower and is now trading back below the 100-day moving average at 1.3758. On the downside, price has re-entered a swing area between 1.37437 and 1.3759. A break beneath that zone would shift focus toward the earlier session low at 1.3738, which also lines up with the neckline of a head-and-shoulders pattern. Below that, traders will be eyeing the August 7 low at 1.3721 as the next key target.
For sellers, keeping the price below the 100-day moving average would leave control in their hands. On the other side, if the pair can regain and hold above the moving average with momentum, a rotation back toward the converged 100- and 200-hour moving averages at 1.3802 would be the upside focus.
The video above walks through these critical support and resistance levels, mapping out the technical landscape following today’s rate decision.
