GBPCAD Continues Lower
The downward trend in GBP this week has been most obvious against commodity currencies. With surging oil prices supporting CAD, and with the BOC kicking off its tightening operation this week, the GBPCAD short trade has continued develop with price now hitting the second target at 1.6853. With both MACD and RSI firmly bearish here and the retail market holding a roughly 90% long position, there Is plenty of room for further downside near term. While price holds below the 1.7041 level, look to stay short for 1.6734 next.
Keep An Eye On
Oil flows look to be key for this pair currently. The recent pause in the crude rally has seen CAD weakening a little. However, given the outlook in Ukraine, oil prices look likely to continue higher (even if the current correction deepens temporarily), meaning that CAD is likely to continue to outperform GBP. The uptick in hawkishness from the BOC also supports the view of a continuation lower in GBPCAD in the coming weeks.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.