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.

Free Trading Guides Download
EUR/USD
Bullish
GBP/USD
Bullish
USD/JPY
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
Gold
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
Oil - US Crude
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
Bitcoin
Bullish
More View more
Breaking news

Markets Extend Losses, Dow Jones Down Over 14 Percent for the Week

Real Time News
  • A special report amid this market slump considering what can stop the burning: 'As $SPX Crashes: What Can the Authorities Do to Stop the Bleeding?' https://www.dailyfx.com/forex/fundamental/article/special_report/2020/02/28/As-SP-500-Crashes-What-Can-the-Authorities-Do-to-Stop-the-Bleeding.html?ref-author=Kicklighter&QPID=917719&CHID=9 https://t.co/HGvNg5iL0M
  • BOE's Cunliffe says Facebook's Libra could become systemically important - BBG
  • The daily decline in silver is its largest since November 2016
  • Alongside gold, $XAG suffered a massive drop today, falling to support around the $16.78 area with RSI tagging oversold territory. Something to keep an eye on in the days to come https://t.co/M9FEyEEf8B
  • Gold drops below 1590 in largest intraday drop since 2013 $XAUUSD https://t.co/aAKI494BMu
  • Join @IG_US and @DailyFX from 7th - 9th March at @TradersExpo, booth number 311 at NY Marriott, Brooklyn Bridge for three days of forex strategy, fundamental and technical analysis discussions. Register here: https://t.co/oziKe3rJZi https://t.co/RhtPlWREnq
  • WHO raises global risk from virus from high to very high - BBG
  • EUR/GBP Weekly Price Forecast: Euro vs British Pound Signals Upside Break More details in the link below: https://www.dailyfx.com/forex/technical/home/analysis/eur-gbp/2020/02/28/EURGBP-Weekly-Price-Forecast-Euro-vs-British-Pound-Signals-Upside-Break-MK.html?CHID=9&QPID=917714 https://t.co/tDLq5YGMXQ
  • $GBP below 1.28, $JPY session highs https://t.co/GpuFtSPdqL
  • Gold is plummeting today alongside stocks, falling more than $60 - https://www.dailyfx.com/forex/market_alert/2020/02/27/Gold-Price-Forecast-Bullion-May-Require-Consolidation-Before-Further-Gains.html
USD/CAD Risks Larger Rebound as Bearish Momentum Abates Following BoC

USD/CAD Risks Larger Rebound as Bearish Momentum Abates Following BoC

2018-04-18 16:02:00
David Song, Currency Strategist
Share:

FX TALKING POINTS:

- USD/CAD Spikes to Fresh Weekly High as Bank of Canada (BoC) Tames Bets for Imminent Rate-Hike. Dollar-Loonie Risks Larger Rebound as Bearish Momentum Abates Ahead of Consumer Price Index (CPI).

- GBP/USD Continues to Pullback from 2018-High (1.4377) Following Lackluster U.K. Consumer Price Index (CPI). Relative Strength Index (RSI) Flops Ahead of Overbought Territory.

DailyFX Table

USD/CAD SPIKES TO FRESH WEEKLY HIGH AS BANK OF CANADA (BOC) TAMES BETS FOR IMMINENT RATE-HIKE.

USDCAD Table

USD/CAD spikes to a fresh weekly-high (1.2636) as the Bank of Canada (BoC) sticks to the current script, and the pair may stage a larger rebound over the coming days as the central bank tames expectations for an imminent rate-hike.

Recent remarks from the BoC suggests the central bank will continue to normalize monetary policy over the medium-term as ‘higher interest rates will be warranted over time,’ but Governor Stephen Poloz and Co. appear to be in no rush to implement higher borrowing-costs as ‘some monetary policy accommodation will still be needed to keep inflation on target.

In turn, market participants may put increased emphasis on the Consumer Price Index (CPI) on tap for Friday as the headline reading for inflation is projected to pick up for the second consecutive month in March, with signs of stronger price growth likely to produce range-bound conditions for USD/CAD as it boosts bets for another BoC rate-hike in 2018.

For more in-depth analysis, check out the Q2 Forecast for USD/JPY

USD/CAD DAILY CHART

USDCAD Daily Chart
  • Near-term outlook for USD/CAD has perked up as the bearish momentum abates, with the pair at risk for a larger rebound as the Relative Strength Index (RSI) appears to be breaking out of the downward trend carried over from the previous month.
  • Need a close above 1.2620 (50% retracement) to open up the topside hurdles, with the first region of interest coming in around 1.2720 (38.2% retracement) to 1.2770 (38.2% expansion) followed by 1.2830 (38.2% retracement).

BRITISH POUND CONTINUES TO PULLBACK FROM 2018-HIGH (1.4377) FOLLOWING LACKLUSTER U.K. CONSUMER PRICE INDEX (CPI).

GBPUSD Table

GBP/USD continues to pull back from the 2018-high (1.4377) as fresh updates to the U.K. Consumer Price Index (CPI) show an unexpected slowdown in both the headline and core rate of inflation, and the British Pound stand at risk of facing additional headwinds as retail sales are anticipated to fall 0.4% during the same period.

Another batch of lackluster data prints is likely to keep the British Pound under pressure as it saps bets for an imminent rate-hike, and the Bank of England (BoE) may stick to the sidelines at the next meeting on May 10 as ‘developments regarding the United Kingdom’s withdrawal from the European Union – and in particular the reaction of households, businesses and asset prices to them – remain the most significant influence on, and source of uncertainty about, the economic outlook.

Keep in mind, the Monetary Policy Committee (MPC) is likely to reiterate that ‘an ongoing tightening of monetary policy over the forecast period will be appropriate to return inflation sustainably to its target at a more conventional horizon,’ but more of the same from Governor Mark Carney and Co. may keep the pound-dollar exchange rate under pressure as the central bank tames bets for higher borrowing-costs.

GBP/USD DAILY CHART

GBPUSD Daily Chart
  • Broader outlook for GBP/USD remains constructive as both price and the Relative Strength Index (RSI) preserve the bullish trends carried over from the previous year, but the failed attempts to close above the 1.4310 (61.8% expansion) to 1.4350 (78.6% retracement) region raises the risk for a near-term pullback especially as the momentum indicator struggles to push into overbought territory.
  • First downside hurdle comes in around 1.4100 (100% expansion) followed by the 1.3970 (50% expansion) region, which lines up with the April low (1.3965), with the next area of interest coming in around 1.3830 (61.8% retracement) to 1.3870 (78.6% expansion).

For more in-depth analysis, check out the Q2 Forecast for GBP/USD

Interested in having a broader discussion on current market themes? Sign up and join DailyFX Currency Analyst David Song LIVE for an opportunity to discuss potential trade setups!

DailyFX Calendar

Additional Trading Resources

Are you looking to improve your trading approach? Review the ‘Traits of a Successful Trader’ series on how to effectively use leverage along with other best practices that any trader can follow.

Want to know what other currency pairs the DailyFX team is watching? Download and review the Top Trading Opportunities for 2018.

--- Written by David Song, Currency Analyst

To contact David, e-mail dsong@dailyfx.com. Follow me on Twitter at @DavidJSong.

To be added to David's e-mail distribution list, please follow this link.

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

DISCLOSURES

News & Analysis at your fingertips.