Market Sentiment Stays Soft, BoC Decides on Mon. Policy

BOC MEETS AHEAD OF TOMORROW’S ECB AND US CPIS

The US dollar traded higher or unchanged against all but one of its major counterparts on Tuesday and during the Asian session Wednesday. It gained the most versus NZD, CAD, and AUD in that order, while it underperformed only against CHF. The greenback was found virtually unchanged against EUR and GBP.

IBEX 35 — TECHNICAL OUTLOOK

Despite drifting a bit lower from the end of May and trading below a short-term downside resistance line taken from the high of May 27th, IBEX 35, at the same time, remains above a short-term tentative upside line drawn from the low of April 21st. Due to the fact that the price is currently sitting between the two trendlines, we will take a neutral stance and wait for a break of one of those lines, before examining the next directional move.

USD/CAD — TECHNICAL OUTLOOK

Although USD/CAD has shown intension to move higher from the start of this month, while balancing above a short-term tentative upside line taken from the low of June 1st, the pair is still running below a short-term downside resistance line taken from the high of May 7th. Given that the rate is currently stuck in between the two trendlines, we will take a neutral stance and wait for a violation of one of them, before examining the next short-term directional move.

AS FOR THE REST OF TODAY’S EVENTS

Apart from the BoC monetary policy decision, the only other item on the financial agenda worth mentioning is the EIA (Energy Information Administration) report on crude oil inventories for last week. The forecast points to a 2.036mn barrels slide following a 5.080mn barrels fall the week before, something which is supported by the API (American Petroleum Institute) report, which revealed a 2.108mn barrels decline during the same week.

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