Usd/cad

However I have discovered a rule that works at least 95% of the time with USDCAD: When I short, it goes up; when I long it goes down. Maybe I could make money selling "inverse price signals".

As predicted, the economic data are starting to come in weaker - zero GDP growth in April - and immediately USDCAD zoomed 115 pips on the news. You ain't seen nuthin' yet.
 
Quote from gspaulsson:

As predicted, the economic data are starting to come in weaker - zero GDP growth in April - and immediately USDCAD zoomed 115 pips on the news. You ain't seen nuthin' yet.
More...

Confused out of my mind over that.
 
I assume what happened is that everyone knew today was mega-announcement day, they expected more sparkling results just like the last bunch and bid the loonie up in anticipation, then when the news was disappointing, they dumped it.
 
So what does everyone think will happen at the BoC announcement? Hike and then a massive sell off of CAD as the bank indicates currency strength has taken most of the inflation bite away?

Hike and then a statement about more hikes to come, and therefore a march towards par?

No hike and a shockwave?
 
I think Thursday's and Friday's announcements will be more interesting. Tomorrow BoC is going to raise rates by 0.25%, ho hum, everybody's known about it for ages and it's already priced in. The market might spend an hour or so zooming up and down as pundits read more into the entrails of the announcement, but then it will settle down to pretty much what it is doing now, which is bouncing up and down in the mid 0400s. I will handle the announcement with my customary bracket stop entry orders and see what happens, but I don't expect a rich return.
 
Actually, I won;t be surprised if it hits parity this year. But it will be brief and then we'll see a USD recovery.

Nothing to back this up however,,, just an opinion.
 
It was just pushed down to 1.0455 by news of the Rio Tinto/Alcan deal ... may go a bit lower once the deal actually goes through. But really even $38 billion or whatever it was is fairly small potatoes, since much of it will no doubt be a stock swap and Alcan can be bought on NYSE ... besides, though it doesn't make the news, Canada does more FDI abroad per capita than the US does ... all those loonies we got for Inco etc will be creeping abroad, buying up this and that and offsetting the headline M&A stories. And the first dribbles of bad economic news as a consequence of the high loonie are starting to come through - housing starts off for June, e.g. On top of that, oil looks due for an unwind, especially with high gas prices and slow US growth cutting into demand ... retail sales down 0.9% in June, looks more & more like a looming recession down there. Maybe oil will drop after labor day when the summer travel season is over. I don't see USDCAD going much below 1.04, and then probably recovering in the fall, maybe to 1.13 ... if the US does go into recession, and especially if the markets crash (a distinct possibility ... the combination of economic slowdown and record stock prices is the classic precrash scenario) ... it would mean lower US imports, bad for the loonie, and if it pushes oil below the $40 threshhold that would be very bad news for the oil patch.
Post-crash stock markets meantime encourage loonies to go bargain-hunting down south ... could see a very rapid climbback,
maybe even towards the levels we saw during the last recession.

I am in the meanwhile shorting USDJPY, which has had an awfully long bull run and is grossly overpriced according to the pundits. Shorted at 122.05, target 120 ... could go as low as 117 (some models predict 109). With the short spread, can also do some intraday scalping.
 
You must log in or register to reply here.
Back
Top