Tech Selloff Continues, BoC Decides on Policy

Equites and Oil Prices Keep Tumbling

The US dollar traded higher against the majority of the other G10 currencies on Tuesday and during the Asian morning Wednesday. It gained the most versus NOK, GBP, CAD, NZD and AUD, while it underperformed slightly only against JPY. The greenback was found virtually unchanged against CHF.

DJIA — Technical Outlook

The Dow Jones Industrial Average index sold off heavily yesterday, ending up breaking a medium-term tentative downside resistance line drawn from the low of April 2 nd. The price found support near the 27197 hurdle, from which it corrected slightly higher. That said, it still remains below that downside line and if it continues trading below it, there is a chance of seeing a bit more downside. However, in order to get a bit more comfortable with lower areas, we would like to wait for a push below the 27197 zone first.

BoC Set to Remain Sidelined

As for today, the main event on the calendar is the BoC interest rate decision. At its last meeting, the BoC decided to keep interest rates unchanged at +0.25% and noted that they will stay there until the 2% inflation target is sustainably achieved. Officials also added that they will continue with their QE program until the economic recovery is well underway, and that they stand ready to adjust their programs if market conditions change.

USD/CAD — Technical Outlook

USD/CAD had a strong move to the upside yesterday, initially breaking the previous highest point of September, at 1.3161, and making its way to the 1.3245 barrier, marked by the high of August 20 th, where it found a temporary hold-up. This morning, the pair is correcting a bit lower, but continues to trade around its 200 EMA on the 4-hour chart. Given yesterday’s strong uprise, there might be a possibility of seeing a continuation of that upmove. But in order to get a bit more comfortable with that idea, a push above the 1.3245 area would be required, hence why we will stay somewhat positive until that break happens.

As for the Rest of Today’s Events

From Canada, apart from the BoC interest rate decision, we also get the nation’s housing starts for August. The US JOLTs job openings for July are also due to be released.

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