FUNDAMENTALOVERVIEWUSD:The US dollar regained someground to start the week as the prolonged US-Iran stalemate has taken oilprices back into triple digit levels. That looks unlikely tochange anytime soon as Trump has rejected Iran’s proposal to first open theStrait of Hormuz and then hold nuclear talks. Unfortunately, with US stockprices at all-time highs Trump might not feel any pressure to concede. This might even set thestage for the next US dollar rally if the Strait of Hormuz remains closed formuch longer and oil prices stay elevated, thus forcing the Fed to hike interestrates in the coming months. Today, we have the FOMCpolicy decision and although the Fed is expected to keep everything unchangedamid the US-Iran uncertainty, there’s a risk of a more hawkish leaning due toresilient US data and a longer than expected US-Iran war. A neutral Fedshouldn’t bring much volatility, but a more hawkish one could give thegreenback a boost.CAD:On the CAD side, the currencyhas erased all US-Iran war losses as the bullish US dollar betsgot unwound. Looking ahead, there are several risks for the CAD ranging from ahawkish BoC amid sluggish economy and the CUSMA renegotiations.Today, we have the BoCpolicy decision where the central bank is widely expected to keep the policyrate unchanged at 2.25%. The central bank will likely maintain a cautiousstance and a "wait and see" approach.The BoC will also releasenew economic forecasts which are expected to mirror the other central banks'outlooks, with upward revision for inflation and downward revision for growth.All in all, the decision isunlikely to bring much volatility as the central bank will likely stressdata-dependency and avoid pre-committing to any rate path.The market is pricing in arate hike in the fourth quarter of 2026, so traders will focus on any change intone and communication that could point to an earlier than expected rate hikeor a strong pushback against market's pricing.USDCAD TECHNICALANALYSIS – DAILY TIMEFRAMEOn the daily chart, we cansee that USDCAD is consolidating rightbetween the two major zones. If we get a pullback into the resistance zonearound the 1.3750 level, we can expect the sellers to step in with a definedrisk above it to position for a drop into the 1.3550 support. The buyers, onthe other hand, will look for a break to open the door for a rally into the1.39 handle next.USDCAD TECHNICALANALYSIS – 4 HOUR TIMEFRAMEOn the 4 hour chart, we havea major downward trendline defining the bearish momentum. The sellers willlikely continue to lean on the trendline with a defined risk above it to keeppushing into new lows. The buyers, on the other hand, will look for a break toextend the pullback into the 1.3750 resistance zone.USDCAD TECHNICALANALYSIS – 1 HOUR TIMEFRAMEOn the 1 hour chart, wehave a minor upward trendline defining the current pullback. The buyers willhave a better risk to reward setup around the trendline to position for a rallyinto the resistance, while the sellers will look for a break to increase thebearish bets into the 1.3550 support next. The red lines define the average daily range for today. UPCOMING CATALYSTSToday we have the BoC and FOMC policy decisions. Tomorrow, we get the monthlyCanada’s GPD, US Q1 GDP, the US Employment Cost Index and the latest US JoblessClaims figures. On Friday, we conclude the week with the US ISM ManufacturingPMI. This article was written by Giuseppe Dellamotta at investinglive.com.