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Start your trading week right by prepping for these top-tier catalysts and checking out my potential trade setup.

Don’t forget to review which factors drove forex market price action last week, too!

Major Economic Events:

BOC rate statement (June 9, 2:00 pm GMT) – The Canadian central bank is widely expected to keep interest rates on hold at 0.25% for the time being.

Still, many are expecting the BOC to hint at tapering stimulus soon, possibly for their July policy decision if the economic recovery and vaccination rollout keeps progressing.

Cautious remarks on the slowdown in hiring and slightly weaker growth figures in Q1 could keep the Loonie’s gains in check, though.

ECB monetary policy statement (June 10, 11:45 am GMT) – No actual policy changes are expected from the ECB as well, and policymakers are even expected to dodge taper talks.

Keep in mind that the eurozone economy isn’t exactly ahead of its peers when it comes to bouncing back from the pandemic, but there have been a few green shoots in terms of economic data.

This should be reflected in the updated ECB staff projections and discussed during the press conference at 12:30 pm GMT. Significant upgrades in growth and inflation could mean some upside for the shared currency.

U.S. CPI figures (June 10, 12:30 pm GMT) – Headline inflation is expected to have dipped from 0.8% to 0.4% in May while the core version could slide from 0.9% to 0.4%.

This might put additional drag on the U.S. dollar, considering how the latest NFP fell short of estimates again. An upside surprise, on the other hand, could keep Fed tapering hopes alive.

Forex Setup of the Week: USD/CAD

USD/CAD 4-hour Forex Chart
USD/CAD 4-hour Forex Chart

I’m keeping this USD/CAD range on my radar, as the pair could be due for either a big bounce or a strong breakout during the BOC statement.

Which way could it go from here?

The range resistance held as a ceiling so far, and it looks like price is heading for the bottom of the range at 1.2030 again. Technical indicators confirm the presence of selling pressure, as Stochastic is pointing down while the 100 SMA is below the 200 SMA.

Sustained bearish momentum on a hawkish BOC decision could spur a break below the range support, followed by a selloff that’s the same height as the range or roughly 100 pips.

On the other hand, a cautious announcement could trigger a bounce back to the top of the range or even a break higher.