USD declined against CAD on Friday, retreating from local highs, updated the day before. The development of negative dynamics was facilitated by not the strongest macroeconomic publications from the USA, which did not conform to market expectations.

The pair is in a correction and may grow.

On the 4-hour chart, a downward correction of the higher level formed as the wave ii of 1 of (3), and the development of the third wave iii of 1 of (3) started. Now, the first wave of the lower level (i) of iii has formed, and the development of the local correction (ii) of iii has started. If the assumption is correct, after the end of the correction, the pair will grow to the levels of 1.3349–1.3450. In this scenario, critical stop loss level is 1.3041.

The USD/CAD pair tested the local minimum of 1.3045 and returned to growth.

On the H4 chart, the uptrend is still in force. The instrument is trading near the upper border of Bollinger Bands; the indicator cloud has expanded, and the uptrend is likely to remain in the short term. MACD histogram is in the positive area. The signal line is crossing the body of the histogram from below forming a signal for opening long positions. Stochastic is in the overbought zone; the oscillator lines are moving horizontally along the border with the neutral zone.

The Bank of Canada has been pursuing a stable monetary policy for a long time: after a cycle of increases, interest rates have not been raised for a year and today remain around 1.75%, equal to the rate of the US Fed.