USDCAD Strategy: Why Chasing Overbought Pairs Is a Trap

The market is navigating a complex mix of central bank policy shifts and localized corporate developments. The European Central Bank has raised its benchmark interest rate by 25 basis points to 2.4%—its first hike in three years—citing the need to counter energy price shocks and a sticky services inflation rate of 3.5% [1][2][3][4]. This hawkish step helped the Euro post a modest weekly gain [1], even as US Producer Price Index (PPI) data came in hot at 1.1% month-over-month against a 0.7% forecast, keeping inflationary worries alive on the other side of the Atlantic. Meanwhile, risk-on appetite in the technology…