News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
EUR/USD
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Oil - US Crude
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Wall Street
Bearish
Gold
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
GBP/USD
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
USD/JPY
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
More View more
Real Time News
  • Excerpt from my #USD weekly forecast - "The premonitions of slower growth, compounded by political volatility from the election may cushion USD’s decline if it triggers a flight to havens" https://www.dailyfx.com/forex/fundamental/forecast/weekly/usd/2020/10/25/US-Dollar-Torn-Between-Q3-Corporate-Earnings-US-GDP-Data-Virus-Spike.html
  • $USD | US Dollar Outlook - via @DailyFX "The US Dollar looks primed for heightened volatility this week as election risk intensifies and key themes like stimulus talks, equity earnings, and COVID-19 restrictions exacerbate uncertainty." Link to Analysis: https://www.dailyfx.com/forex/fundamental/us_dollar_index/usd_trading_today/2020/10/26/usd-price-outlook-us-dollar-in-the-hot-seat-as-election-nears.html https://t.co/B6HS0ecNPD
  • There are some major economies set to update on the health through the third quarter this week. The US and Eurozone are later this week, but South Korea is due to report this morning. When was the last time you took a look at the $USDKRW? https://t.co/UQLHfonxnO
  • Heads Up:🇳🇿 Balance of Trade (SEP) due at 21:45 GMT (15min) Previous: N$-353M https://www.dailyfx.com/economic-calendar#2020-10-26
  • The Euro remains the largest long by some margin, despite investors trimmed their bullish bets yet again. While the blue wave election trades are USD negative. Get your market update from @JMcQueenFX here:https://t.co/FxzsRmXYVN https://t.co/V4n7ncl1WA
  • Forex Update: As of 20:00, these are your best and worst performers based on the London trading schedule: 🇯🇵JPY: -0.10% 🇳🇿NZD: -0.13% 🇬🇧GBP: -0.16% 🇨🇭CHF: -0.40% 🇪🇺EUR: -0.43% 🇨🇦CAD: -0.66% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/YlP6D1tUc2
  • Commodities Update: As of 20:00, these are your best and worst performers based on the London trading schedule: Gold: -0.03% Oil - US Crude: -0.08% Silver: -1.40% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/4D7w33mAud
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 96.86%, while traders in NZD/USD are at opposite extremes with 73.83%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/48N5RecRwt
  • RT @Nadex: Will the Dow be bullish or bearish after Nov. 3? Make your prediction today for a chance to win $5,000.* https://t.co/EXtYKMxrrW…
  • Australian #Dollar Forecast: $AUDUSD Grinds into Downtrend Resistance- #Aussie Levels - https://t.co/Y4oiWHaE6l https://t.co/GYpXhkKJIo
Canadian Dollar to Correct Higher Against British Pound

Canadian Dollar to Correct Higher Against British Pound

2017-05-11 16:17:00
Martin Essex, MSTA, Analyst
Share:

Taking a long-term view, the British Pound has been one of the strongest major currencies so far this year while the Canadian Dollar has been one of the weakest. It might seem perverse, therefore, to go short GBP/CAD but in the near-term I’m expecting the CAD to correct higher against both the GBP and the USD.

The principal reason is that the Canadian dollar is a petro-currency, tending to move with the price of oil, which is a mainstay of the Canadian economy. And over the last few days the price of US crude has climbed from just over $44 per barrel a week ago to more than $48 per barrel currently.

That’s despite a report today from the Organization of the Petroleum Exporting Countries (OPEC) forecasting a sharp increase in output from US shale drillers, and is good news for the Canadian Dollar, which has stabilized in recent days against both the US Dollar and the British Pound after a long period of weakness.

Chart: GBP/CAD Daily Timeframe (Jan 1 – May 11, 2017)

Canadian Dollar to Correct Higher Against British Pound

Chart by IG

From a technical perspective, the pattern formed over the last few days on the chart above looks like a rounded top, a reversal pattern signaling that the upward trend in GBP/CAD could be ending and that we’ve reached a potential reversal point. The strength of the oil price despite the rather gloomy OPEC report suggests that it’s now bouncing higher, while the Pound could well succumb to General Election and Brexit jitters now that both a victory for the ruling Conservative Party and a “soft” Brexit seem to be fully priced in. Moreover, today’s weak UK data and the Bank of England’s quarterly Inflation Report suggesting that UK interest rates are unlikely to rise within the next two years suggest the Pound’s losses of the past few days could continue, at least for a while.

As the chart shows, there’s very little support for GBP/CAD until the area around 1.66, where it traded from mid-March to mid-April so that seems a reasonable medium-term target. On the other hand, a break above the 1.7849 high reached on May 5 would signal a resumption of the upward trend so that would be a sensible place at which to place a stop.

- Check out the DailyFX Economic Calendar and see what live coverage of key event risk impacting FX markets is scheduled for the week on the DailyFX Webinar Calendar.

--- Written by Martin Essex, Analyst and Editor

To contact Martin, email him at martin.essex@ig.com

Follow Martin on Twitter @MartinSEssex

If you’re looking for trading ideas, check out our Trading Guides; they’re free and updated for the second quarter of 2017

If you’re looking for ideas more short-term in nature, check out the IG Client Sentiment Data

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES