AUDCAD 2H
Fundamentals:
•The RBA has made its first rate cut, initiating its rate-cutting process. However, this is more of a symbolic cut rather than a genuine attempt to stimulate the economy. It was essentially a “hawkish cut” from the RBA.
•We could see a shift in risk sentiment, with the S&P500 currently in an uptrend but recently rejecting a daily resistance. In my opinion, this rejection is just a minor correction.
•Oil is also in a downtrend, which should negatively impact the Canadian dollar.
•Furthermore, market expectations for interest rates suggest a hold for both central banks, but with an 80% probability for the RBA compared to 60% for the BoC.
•Additionally, since the US dollar is undergoing a short to medium-term correction, this could also weigh on the Canadian dollar due to the positive correlation between the two currencies.
Technical Analysis:
•On the daily timeframe, we can see a descending triangle that has just broken to the upside.
•On the 8H timeframe, there is a clear double bottom on the Bullish TrendLine, which acted as strong support. Price is also returning to the trendline, but more importantly, to Fibonacci levels aligning with a major resistance-turned-support.
•Retail traders are predominantly short (91%), confirming a potential buying opportunity.
•I am placing a buy limit at the 50% Fibonacci level at 0.90060.
•Wide stop-loss as we might see portfolio rebalancing from major institutions due to the end of the month, which could bring volatility.
•Take profit at 0.92700.
•Risk-to-reward ratio: 3.3.
•Half-risk position due to Australian CPI on Wednesday and Canadian GDP data on Friday.
Fundamentals:
•The RBA has made its first rate cut, initiating its rate-cutting process. However, this is more of a symbolic cut rather than a genuine attempt to stimulate the economy. It was essentially a “hawkish cut” from the RBA.
•We could see a shift in risk sentiment, with the S&P500 currently in an uptrend but recently rejecting a daily resistance. In my opinion, this rejection is just a minor correction.
•Oil is also in a downtrend, which should negatively impact the Canadian dollar.
•Furthermore, market expectations for interest rates suggest a hold for both central banks, but with an 80% probability for the RBA compared to 60% for the BoC.
•Additionally, since the US dollar is undergoing a short to medium-term correction, this could also weigh on the Canadian dollar due to the positive correlation between the two currencies.
Technical Analysis:
•On the daily timeframe, we can see a descending triangle that has just broken to the upside.
•On the 8H timeframe, there is a clear double bottom on the Bullish TrendLine, which acted as strong support. Price is also returning to the trendline, but more importantly, to Fibonacci levels aligning with a major resistance-turned-support.
•Retail traders are predominantly short (91%), confirming a potential buying opportunity.
•I am placing a buy limit at the 50% Fibonacci level at 0.90060.
•Wide stop-loss as we might see portfolio rebalancing from major institutions due to the end of the month, which could bring volatility.
•Take profit at 0.92700.
•Risk-to-reward ratio: 3.3.
•Half-risk position due to Australian CPI on Wednesday and Canadian GDP data on Friday.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.