Bullish Momentum Remains on the Table Following a Support Rejection

Central Bank

Economic

Summary:

Looking at the oscillators, the RSI currently stands at 49 and is approaching the bullish territory after rebounding from 26, where it had previously reached considerably oversold conditions.

BUY AUDCAD

EXP

TRADING

0.97462

Entry Price

0.98170

0.96900

0.97655 +0.00266 +0.27%

0.0

Pips

Flat

0.96900

Exit Price

0.97462

Entry Price

0.98170

The Reserve Bank of Australia (RBA) raised its cash rate by 25 basis points to 4.85%, although its statement adopted a less aggressive tone regarding the possibility of further monetary tightening. The decision was reached through a 6-3 vote, with three members favoring an unchanged rate due to concerns about rising unemployment and weakness in the housing market.

The RBA also revised its inflation forecasts upward, with both headline and core inflation now expected to remain above 3% through the end of 2027. Inflation is not projected to return to the midpoint of the central bank's 2-3% target range until mid-2028. The decision suggests that the RBA could pause at its next meeting, although further tightening cannot be ruled out if inflationary pressures remain persistently elevated.

Reserve Bank of Australia Deputy Governor Andrew Hauser also spoke during the Sir Leslie Melville Lecture on “Trust, Expectations and Monetary Policy” at the Australian National University in Canberra on Thursday, during the European session. His comments explicitly highlighted that inflationary pressures remain very elevated, reinforcing the central bank's concerns about the persistence of price increases.

In Canada, employment declined for the third consecutive month in October, according to data released by Statistics Canada on Friday. The economy lost 4.7K jobs, compared with market expectations for an increase of 13.6K, following declines of 68.3K in September and 41.7K in August. Meanwhile, the Unemployment Rate rose to 6.7% from 6.5%, reflecting further weakness in labor market conditions.

The Bank of Canada (BoC) raised its benchmark interest rate by 25 basis points to 2.50% in October and indicated that additional increases could become necessary to prevent higher energy costs from spreading into broader inflation. However, the latest employment figures make the outlook more complicated for policymakers. Persistent inflationary pressures continue to leave the possibility of another rate increase open, although the weakening labor market provides an additional reason to wait before implementing further monetary tightening. Bullish Momentum Remains on the Table Following a Support Rejection_1

Bullish Momentum Remains on the Table Following a Support Rejection_1

Technical Analysis

AUDCAD has recovered from its local lows after reaching 0.9648 on November 6. The pair has recently experienced a modest pullback, finding support around 0.9725. If price manages to hold above this level, bullish momentum could accelerate once again toward the descending trendline, where the 100-period and 200-period moving averages are positioned nearby at 0.9873 and 0.9902, respectively. In this context, the resistance area around 0.9817 could act as an intermediate level, potentially attracting price toward the broader cluster of technical indicators.

Looking at the oscillators, the RSI currently stands at 49 and is approaching the bullish territory after rebounding from 26, where it had previously reached considerably oversold conditions. Meanwhile, the MACD shows a bullish histogram that has lost some of its depth. However, its signal lines are moving closer to the neutral zone, and a bullish crossover could bring both components into alignment with the ongoing recovery. If this develops, it could provide additional support for the upside move and potentially accelerate bullish momentum.

Trading Recommendations

Trading direction: Buy

Entry price: 0.9744

Target price: 0.9817

Stop loss: 0.9690

Validity: Nov 20, 2026 15:00:00

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Bullish Momentum Remains on the Table Following a Support Rejection

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