With the BOC statement coming up, I’m counting on a big move from this Loonie pair.
Think we’ll see a bounce or a break?
Before moving on, ICYMI, today’s Daily Asia-London Session Watchlist bet on Australia’s economic releases to push AUD/NZD around. Be sure to check that out to see if there is still a potential play!
And now for the headlines that rocked the markets in the last trading sessions:
Fresh Market Headlines & Economic Data:
- Australia’s Westpac consumer sentiment down 5.2% in June
- Chinese CPI up from 0.9% to 1.3% vs. 1.6% forecast
- China’s producer prices jumped 9.0% in May
Upcoming Potential Catalysts on the Economic Calendar:
- BOC monetary policy decision at 2:00 pm GMT
- U.S. crude oil inventories at 2:30 pm GMT
What to Watch: GBP/CAD
GBP/CAD has been moving sideways on its short-term chart, finding support at 1.7035 and resistance around 1.7160.
The BOC decision today could be a strong catalyst, as the central bank already shifted to a more hawkish stance in their earlier announcement.Market watchers are on the lookout for remarks on higher inflation, which could then boost BOC tightening prospects.
Apart from an optimistic outlook from the Canadian central bank, another factor that could prop up the Loonie is the surge in oil prices.
See how WTI crude oil already busted through the $70 per barrel mark?!
A combination of stronger demand, risk appetite, and limited OPEC+ supply could be enough to prop up the commodity price, which is bullish for the oil-related Canadian dollar.
If the top of the range holds, GBP/CAD could retreat to the bottom or perhaps attempt to break lower. Stochastic is already indicating overbought conditions after all, so sellers might return while exhausted buyers take a break.