Trade Closed: 2008-01-07 10:47
We saw a break out to the upside on USD/CAD after Friday’s US Jobs data and our long position was entered at 1.0030. Unfortunately, the pair retraced back below parity to hit our stop during the morning European trading session.
Total: – 50 pips/ -1%
I still believe we will see the Dollar rally in the short term, especially since the pair has bounced back up above parity in favor of the dollar. Our stop may have been a bit to tight this time. So, we will continue to watch the Comdolls during a particularly uncertain times in the markets.
Trade Idea: 2008-01-02 13:25
Happy New Year Everyone! To start off 2008, I am watching the Loonie for a potential breakout move in the short term.
As we can see on the chart, the pair was on a steady downtrend before we saw a very sharp correction to the upside. Now, we are in the midst of a consolidation as traders try to figure out where to go to next.
Fundamentally, Canada’s outlook is a little foggy in the short term with concerns of another interest rate cut from the BoC as inflation seems to be kept in check by the rapid appreciation of the Loonie. On the other side of the coin, Canada’s economy may be supported by exports with the markets speculating another commodity boom (half of Canada’s exports are made up of commodities such as oil, gold, etc.). With oil trading at $100/barrel today, if that trend continues the Loonie may continue to find a bid.
So, we may see a few more days of consolidation before a potential pop this week with US NFP data coming out on Friday. With the current trend down and the market looking overbought at the moment, I’m favoring a short trade. But, if we see strong Jobs data from the US, that combined with rate cut speculation in Canada, should boost USD/CAD higher in the short term.
Good luck my friends!