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Bank of Canada hiked its overnight rate to from 1.25% to 1.50% yesterday. Rate statement was more hawkish that many expected and the initial reaction was to buy Canadian dollars, with USD/CAD quickly testing support at 1.3060. However, a strong round of broad U.S. dollar buying followed, which took the pair 150 pips higher.
al_dcdemo's Blog
Canadian dollar rallies on BOC, reverses on tariffs
Bank of Canada caught many off guard on Wednesday. The bank kept overnight rate unchanged at 1.25% but released a hawkish statement, that now puts July hike firmly on the table. However, trade wars continue with steel and aluminium tariffs, which is a headwind for Canadian dollar. USD/CAD 1.30 is the bull/bear line in sand.
BOC remains upbeat in the face of trade uncertainty
Bank of Canada stood pat at yesterday's meeting. Similarly to the RBA on Tuesday, they could've spinned monetary policy statement more dovish in current conditions if they had wanted to, but they didn't. However, it's all about trade wars currently and USD/CAD proceeded to make a marginal new high before some positive news on tariff exemptions for Canada hit the wires. Technically, 100 WMA ahead of historically proven 1.30 - 1.305 area looks strong enough to cause the pair to retrace a bit more …
Bank of Canada hikes, Canadian dollar whipsaws
Bank of Canada hiked overnight rate for the third time in this cycle. Market reaction was messy. There appears to have been a leak which prompted sell-the-fact trade about 20 seconds before the release. Price then whipsawed in a 150-pip range before settling in the middle. 1.24 is the initial support, 1.25 the resistance.
U.S. dollar strong but yen outperforms
Cautious tones from ECB and BOC, weak Australian inflation one side and progress in U.S. politics and much better than expected Advance GDP reading on the other one were among the drivers of major currency pairs this week. BOE is expected to hike next week but it will be a one-off for now.
The U.S. dollar was mostly bought up until around the time Europe started heading for the pub. Rumor of Trump leaning toward Powell as the next Fed chair sparked a bout of profit-taking. The dollar ended the w…
The U.S. dollar was mostly bought up until around the time Europe started heading for the pub. Rumor of Trump leaning toward Powell as the next Fed chair sparked a bout of profit-taking. The dollar ended the w…
USD/CAD rallies as Bank of Canada expresses caution
BOC decided to leave overnight rate at 1.0% at today's meeting. GDP forecasts were revised slightly lower while CPI forecasts were just marginally bumped up. The bank expressed concern with regard to geopolitical developments, NAFTA and high levels of household debt, and said they will be cautious in making future adjustments to the rate.
The fact that such a scenario was widely anticipated didn't help the Canadian dollar. After a quick washout to 1.2635, USD/CAD jumped 100 pips, added 80 more i…
The fact that such a scenario was widely anticipated didn't help the Canadian dollar. After a quick washout to 1.2635, USD/CAD jumped 100 pips, added 80 more i…
USD/CAD breaks above 1.25
Canadian dollar convincingly broke above 1.25 yesterday, after weaker than expected trade data. The main driver, however, has been repricing of excessive rate hike expectations after BOC expressed concern about currency strength and signaled a pause in tightening cycle.
USD/CAD so far rose more than 500 pips from the low set near 1.2050 in September. Pullbacks have been shallow. 100 DMA is the initial target before late August high and then 38.2% retracement of the May - September downswing. 1.2…
USD/CAD so far rose more than 500 pips from the low set near 1.2050 in September. Pullbacks have been shallow. 100 DMA is the initial target before late August high and then 38.2% retracement of the May - September downswing. 1.2…
Loonies consolidates after a big move
USD/CAD appears to be in the process of making a (short-term) bottom above the 50.0% retracement of the 2011 - 2016 uptrend. Volatility fell in recent days as the pair consolidates after selling off following the second consecutive rate hike by the BOC.
Many are expecting one more hike from the bank as early as this year and that should keep sellers involved. 1.2230 - 1.2250 is the initial resistance and the next one somewhere in 1.23 - 1.2350 area. Buyers were seen near 1.2125.
Many are expecting one more hike from the bank as early as this year and that should keep sellers involved. 1.2230 - 1.2250 is the initial resistance and the next one somewhere in 1.23 - 1.2350 area. Buyers were seen near 1.2125.
Loonie spikes as Bank of Canada hikes
BOC hiked overnight rate for the second time in a row. This was not all that unexpected but, judging by the magnitude of the move in Canadian dollar pairs, caught many wrong-footed. Rate statement does not rule out further hikes. Another hawkish hike by the bank.
USD/CAD spiked about 270 pips, to 1.2130, in less than a minute before pulling back. 1.2180 - 1.22 seems like holding for now. Some resistance may be encountered at 1.2250 and more at 1.23 - 1.2330. 1.25 should probably cap a stronger b…
USD/CAD spiked about 270 pips, to 1.2130, in less than a minute before pulling back. 1.2180 - 1.22 seems like holding for now. Some resistance may be encountered at 1.2250 and more at 1.23 - 1.2330. 1.25 should probably cap a stronger b…
USD/CAD sells off after hawkish BOC
Bank of Canada raised the overnight rate to 0.75% from 0.50%. It was the first interest rate hike by the bank after seven years. The hike was widely anticipated but the bank surprised with a hawkish statement. I think at least one more hike is to be expected from them this year.
USD/CAD sold off nearly 230 pips (1.8%) before bouncing off of 38.2% retracement of the 2011 - 2016 uptrend. That is the support level to watch in the days ahead. On the upside, 1.28 - 1.285 looks like a decent area for …
USD/CAD sold off nearly 230 pips (1.8%) before bouncing off of 38.2% retracement of the 2011 - 2016 uptrend. That is the support level to watch in the days ahead. On the upside, 1.28 - 1.285 looks like a decent area for …