2023-12-19 • Updated
The Canadian dollar remained near its four-month high against the U.S. dollar, trading at 1.3390, supported by increased oil prices and anticipation of interest rate cuts in 2024. The loonie had touched its strongest level since August 4 at 1.3347 following the Federal Reserve's signal of potential interest rate cuts next year. Analysts suggest that the risk appetite for central bank rate cuts in 2024 has contributed to the Canadian dollar's strength. The upcoming Canadian Consumer Price Index report is expected to show a slowdown in inflation to 2.9% in November from 3.1% in October. A higher inflation number could influence the Bank of Canada to maintain current interest rates, further strengthening the loonie. Meanwhile, disruptions in maritime trade due to attacks by the Iran-aligned Yemeni Houthi militant group pushed up oil prices, a significant export for Canada. Canadian government bond yields rose, with the 10-year yield at 3.187%, rebounding from a seven-month low touched on Friday.
USDCAD on the Daily timeframe made an initial reaction away from the pivot zone yesterday, followed by the current retracement that seems to be currently on-going. In light of this, and the market structure on the 4-Hour timeframe, I believe the CPI numbers will provide the needed momentum for price to complete a proper rejection from the pivot zone. In this case, however, I’d advice that proper confirmations be sought from the lower timeframes before taking a trade.
Analyst’s Expectations:
Direction: Bullish
Target: 1.34918
Invalidation: 1.33489
EURCAD is steadily climbing towards the rally-base-drop supply zone on the 4-Hour timeframe. By the time price reaches the supply zone, it would be coming under bearish pressure from two resistance trendlines, as well as the 100 and 200 period moving averages. Considering that the moving averages are arrayed in a bearish order, this lends extra credence to my bearish sentiment.
Analyst’s Expectations:
Direction: Bearish
Target: 1.45591
Invalidation: 1.47831
In the case of CADJPY, the price action is currently riding upwards, with a likely target being the rally-base-drop supply zone. Additional confluences to the supply zone include; the bearish array of the moving averages, 200-period moving average resistance, and the resistance trendline intersection. In spite of these confluences though, it is crucial to note that further confirmation can still be sought before you take a position on these trade ideas.
Analyst’s Expectations:
Direction: Bearish
Target: 105.897
Invalidation: 109.683
The trading of CFDs comes at a risk. Thus, to succeed, you have to manage risks properly. To avoid costly mistakes while you look to trade these opportunities, be sure to do your due diligence and manage your risk appropriately.
You can access more of such trade ideas and prompt market updates on the telegram channel.
During the Asian session on Wednesday, the USD/CAD pair rebounded after two days of losses, reaching around 1.3590. This uptick is fueled by a stronger US dollar and lower crude oil prices, which put pressure on the Canadian dollar. The decline in Western Texas Intermediate (WTI) oil prices to approximately $80.70 is attributed to...
The Australian Dollar (AUD) rebounds on Monday, despite a slight dip in the US Dollar (USD) and higher US Treasury yields. Investors are eyeing Australian monthly Consumer Price Index (CPI) data for February and US Gross Domestic Product (GDP) for Q4 2023. The AUD gains momentum as the ASX 200 Index rises, especially in mining and energy sectors. Additionally, the Aussie...
Gold prices rose on Monday as the US Dollar weakened amidst speculation about potential Federal Reserve rate cuts starting in June. This weakened Dollar was partly due to improved risk sentiment pushing US Treasury yields lower. Despite facing challenges from declining yields, gold prices recovered to nearly $2,170 per troy ounce, driven by the Dollar's weakness. Federal Reserve Chair...
Jerome H. Powell, the Federal Reserve chair, stated that the central bank can afford to be patient in deciding when to cut interest rates, citing easing inflation and stable economic growth. Powell emphasized the Fed's independence from political influences, particularly relevant as the election season nears. The Fed had raised interest rates to 5.3 ...
Hello again my friends, it’s time for another episode of “What to Trade,” this time, for the month of April. As usual, I present to you some of my most anticipated trade ideas for the month of April, according to my technical analysis style. I therefore encourage you to do your due diligence, as always, and manage your risks appropriately.
Bearish scenario: Sell below 1.0820 / 1.0841... Bullish scenario: Buy above 1.0827...
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Don’t waste your time – keep track of how NFP affects the US dollar and profit!
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