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Great Graphic: Canadian Dollar Trendline Approached

Summary:
The Canadian dollar's advance continues.  Neither the widening of interest rate differentials in the US favor nor a poor employment report has managed to buckle the Loonie. Oil and the general risk-on mood trump the other concerns.  In addition, investors are concluding that fiscal stimulus will reduce the possibility of additional monetary stimulus.  The implied yield on the June BA futures is now the highest since last June.  The Great Graphic, made on Bloomberg shows the greenback's uptrend since mid-2014.  The 10.4% US dollar slide since the multi-year high was reached in late-January, has brought it within striking distance of that trendline, which is found near CAD1.3140 today.  A break would target CAD1.30 initially.   Earlier this week, I expressed my concern for the outlook for the Canadian dollar.  I remain concern, believing overtime the interest rate differential exerts gravitational pull.  However, discipline requires respecting the price action.  From a technical perspective, the break of the trendline is significant.

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Great Graphic:  Canadian Dollar Trendline Approached
The Canadian dollar's advance continues.  Neither the widening of interest rate differentials in the US favor nor a poor employment report has managed to buckle the Loonie. Oil and the general risk-on mood trump the other concerns. 
In addition, investors are concluding that fiscal stimulus will reduce the possibility of additional monetary stimulus.  The implied yield on the June BA futures is now the highest since last June. 
The Great Graphic, made on Bloomberg shows the greenback's uptrend since mid-2014.  The 10.4% US dollar slide since the multi-year high was reached in late-January, has brought it within striking distance of that trendline, which is found near CAD1.3140 today.  A break would target CAD1.30 initially.  
Earlier this week, I expressed my concern for the outlook for the Canadian dollar.  I remain concern, believing overtime the interest rate differential exerts gravitational pull.  However, discipline requires respecting the price action.  From a technical perspective, the break of the trendline is significant.  

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Marc Chandler
He has been covering the global capital markets in one fashion or another for more than 30 years, working at economic consulting firms and global investment banks. After 14 years as the global head of currency strategy for Brown Brothers Harriman, Chandler joined Bannockburn Global Forex, as a managing partner and chief markets strategist as of October 1, 2018.

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