The market expects a 50bp increase rather than a 25bp increase at the Bank of Canada (BoC) meeting on April 13, in addition to the already expected 175bp increase in the discount rate by the end of the year. Since Canada is a highly indebted economy, there is an opportunity for a dovish reversal either in April or later this year, which would create an asymmetrical downturn for the CAD.
Our Analysis:
As long as price is above 0.8640 follow the recommendations below:
- Time frame: D1
- Recommendation: long position
- Entry point: 0.8741
- Take Profit 1: 0.8810
- Take Profit 2: 0.8910
Alternative scenario:
If the level of 0.8640 is broken-down, follow the recommendations below:
- Time frame: D1
- Recommendation: short position
- Entry point: 0.8640
- Take profit 1: 0.8545
- Take profit 2: 0.8400
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