The U.K. is releasing its monthly GDP numbers in a few days so I thought y’all would like to look at opportunities on GBP pairs.
Today I’m looking at GBP/CAD’s chart for a support play.
What do you think?
If you’re all set to trade the U.S. inflation report, then you might want to set your sights on the U.K.’s monthly GDP release on Friday at 7:00 am GMT.
Analysts see the headline GDP printing at 0.3% in November after a 0.1% uptick in October.
Unless we see a surprisingly disappointing growth figure, though, then the report isn’t likely to interfere with the Bank of England’s (BOE) plans to raise its interest rates even higher this year. Some are even penciling in a February rate hike!Rate hike talks could push GBP/CAD from its current levels, which is already close to the 1.7100 major area of interest on the 4-hour time frame.
GBP/CAD is currently trading above the 200 simple moving average while Stochastic nears the “oversold” zone.
If traders feel more comfortable about buying GBP/CAD, then the pair could revisit its 1.7200 inflection point or even the 1.7300 January highs.
Don’t overlook a potential support breakdown though!
Crude oil – one of Canada’s biggest exports – has been having a good week so far as traders priced in their confidence that the Fed would not derail the pace of global economic recovery while they taper their stimulus measures.
If the U.K.’s GDP report turns out to be a dud, or if overall risk-taking benefits comdolls like CAD more than GBP, then GBP/CAD could trade below 1.7100 to test areas of interest like 1.7050 or 1.6950.
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