Global macro overview for 13/10/2017:
According to economists, the candidates are: current Chairperson Janet Yellen, Vice President Jerome Powell, Chief Economic Officer Gary Cohn and Kevin Warsh. Not putting too much emphasis on the topic, among the four nominees, Janet Yellen is considered the most dovish about the future monetary policy.
At the beginning of the month, the number one candidate to replace Janet Yellen in the chair of the Fed became Kevin Warsh. It would be the best choice for the US Dollar as it is perceived as a fierce critic of quantitative loosening policies and a person concerned by excessively loose financial conditions in the economy. Jerome Powell (from the Fed's Board of Governors) is definitely ahead of the pack. The illusory probability is attributed to candidates Janet Yellen and Gary Cohn.
The verdict of Trump administration is to be announced even today and might cause an increased volatility in the currency market. If we add that the rotation of voting FOMC members next year is towards a more hawkish group, then all of this favors a further increase in US bond yields and ongoing support of USD rally.
Let's now take a look at the USD/CAD technical picture in the H4 time frame. The price has fallen out of the golden channel and now is trading inside of a narrow range between the levels of 1.2483 - 1.2416. To move lower, the bear would have to break through the support zone between the levels of 1.2416 - 1.2454. Then the next technical support would be seen at the level of 1.2338.
The material has been provided by InstaForex Company - www.instaforex.com