AUDCAD, H4
Today Markets focus mainly in Brexit and in sterling with U.K. officially handed in the divorce papers to the EU today, but while battle lines are being drawn up nothing really changes for now and as both sides still have to sort out difference over the sequence of talks and the first EU Brexit summit is still a month away talks won’t really start in earnest for a while. Elsewhere however, the dollar edged a touch higher after the stronger pending home sales outcome, taking USDJPY to 111.08 and EURUSD down a few ticks to 1.0750. Additionally, WTI crude rallied to $49.14 from $48.60 following the EIA inventory data which showed a 900k bbl rise in crude stocks.
Consequently, the Loonie continues firmed from early lows as crude oil sustained gains. It is notable to say that there was not any domestic data overnight beside EIA Inventory data earlier and an appearance by BoC Governor Poloz yesterday, saw him maintain a cautious view of recent firm economic data. He remains focused on downside risk, which in our view should keep rates steady well into next year.
Therefore, Canadian dollar climbed alongside a pick-up in oil prices, with AUDCAD currently trading near higher to 1.0250 area. The pair presents an upward trend since the beginning of the week. The 4-hour chart is showing bullish signs with RSI at 62 sloping up while the MACD has crossed the 0 line. The price is trading in the upper Bollinger band and above 50.0 Fibonacci level, which suggest that upward momentum will continue. In the Daily chart, 30 day EMA provides support at 1.017.
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Andria Pichidi
Market Analyst
HotForex
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