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CAD Outlook vs British Pound and New Zealand Dollar

CAD Outlook vs British Pound and New Zealand Dollar

Dimitri Zabelin, Analyst


What's on this page

Canadian Dollar, British Pound, New Zealand Dollar, GBP/CAD, NZD/CAD – TALKING POINTS

  • GBP/CAD may be bottoming out after false breakout led to over 3 percent decline
  • Pair may challenge descending resistance again – what happens if it capitulates?
  • NZD/CAD broke below uptrend, key inflection range – is a recovery in the works?

Canadian Dollar Outlook vs British Pound

GBP/CAD recently fell over 3.40 percent following a false breakout above descending resistance dating back to early-March. However, recent price action suggests the pair may be bottoming out at 1.7006 and could once again challenge the slope of depreciation. If the pair manages to clear it with follow-through, the next point of resistance could be a ceiling at 1.7276 (purple-dotted line).

GBP/CAD – Daily Chart

Chart showing GBP/CAD

GBP/CAD chart created using TradingView

On the other hand, if bold price action becomes more timid as the pair approaches descending resistance and capitulation ensues, it could cast a bearish shadow on the pair. This may in turn catalyze an aggressive selloff and cause GBP/CAD to shatter several layers of support. In this scenario, selling pressure could start abating at 1.6851.

Canadian Dollar Forecast vs New Zealand Dollar

NZD/CAD recently broke below a multi-week slope of appreciation and a key inflection range between 0.8524 and 0.8499. However, the decline appears to have been short-lived with recent price action suggesting NZD/CAD may be readying to retest the previously-broken zone. Clearing it with follow-through could open the door to retesting the March-high at 0.8668 where the pair previously had stalled.

NZD/CAD – Daily Chart

Chart showing NZD/CAD

NZD/CAD chart created using TradingView

Conversely, if buyers lose momentum prior to the inflection area, the force of sellers could send the pair crashing down and lead to a retest of the 0.8321-0.8298 support range. Shattering that multi-layered floor could leave the pair vulnerable to retesting the seven-year swing-low at 0.8170.

--- Written by Dimitri Zabelin, Currency Analyst for

To contact Dimitri, use the comments section below or @ZabelinDimitri Twitter

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