USDCAD TECHS: Bears Remain In The Driver's Seat

@realDonaldTrump on Truth Social says re today's missile attacks: "Iran has officially responded to our Obliteration of their Nuclear Facilities with a very weak response, which we expected, and have very effectively countered. There have been 14 missiles fired — 13 were knocked down, and 1 was “set free,” because it was headed in a nonthreatening direction. I am pleased to report that NO Americans were harmed, and hardly any damage was done. Most importantly, they’ve gotten it all out of their “system,” and there will, hopefully, be no further HATE. I want to thank Iran for giving us early notice, which made it possible for no lives to be lost, and nobody to be injured. Perhaps Iran can now proceed to Peace and Harmony in the Region, and I will enthusiastically encourage Israel to do the same. Thank you for your attention to this matter! DONALD J. TRUMP, PRESIDENT OF THE UNITED STATES OF AMERICA"

On Tuesday morning (0830ET) we get the first of two monthly CPI readings ahead of the next BOC decision on July 30. 

• Consensus for the Y/Y headline reading is 1.7%, with a slight upward skew (similar to April's 1.74% unrounded figure), while the non-seasonally adjusted M/M consensus is 0.5% (MNI Median; BBG survey is same and average indicates a slight downward skew at 0.48%) after -0.1% in April.
• Meanwhile the average of the BOC's preferred trim and median core measures is seen coming in at 3.0% Y/Y (3.15% unrounded in April), the highest in over a year.
• While as noted there is another CPI report to come before the July BOC decision, another upside surprise in core measures could see a retracement of recent cut repricing (last 10bp, vs 6bp last week), with analysts remaining split on July easing expectations.
• The deliberations of the June meeting reported “If the recent firmness in underlying inflation were to persist, it would be more difficult to cut the policy rate".
• A reading in line with consensus would keep the door open to a cut amid a pullback in the 3mma annualized rate in trim/median average to 3.1/3.2% from 3.4% prior.

• RES 4: 0.6700 76.4% retracement of the Sep 30 ‘24 - Apr 9 bear leg
• RES 3: 0.6688 High Nov 7 ‘24
• RES 2: 0.6603 High Nov 11 ‘24
• RES 1: 0.6479/6552 20-day EMA / High June 16 and the bull trigger
• PRICE: 0.6428 @ 15:46 BST Jun 23
• SUP 1: 0.6373 Low Jun 23
• SUP 2: 0.6357 Low May 12    
• SUP 3: 0.6309 38.2% retracement of the Apr 9 - Jun 16 bull cycle
• SUP 4: 0.6275 Low Apr 14

The medium-term trend set-up in AUDUSD is unchanged, the outlook remains bullish. However, a corrective cycle is in play and this has resulted in a break of support around the 50-day EMA, at 0.6435. A clear break of this average would signal scope to a deeper correction and open 0.6357, the May 12 low. Clearance of this support would highlight a stronger reversal. Initial resistance to watch is 0.6479, the 20-day EMA.