After months of speculations, rumors and hearsay, the Bank of Canada finally decided to raise interest rates. The central bank bumped its target overnight rate by 0.25% to 0.50%. Thus Canada became the first of G-7 countries to increase rates following the 2008 crisis. One would expect this action to push CAD higher. That didn’t happen. In fact, the Loonie fell against most other currencies. Markets probably perceived the bank’s action as not enough, given how long the suspense period was. Now press is smarting that the drop in CAD happened because the BOC didn’t include the usual statement about further rate hikes needed. Whatever. Bottom line is that Canadian Dollar fell on seemingly positive news. Ah, the dangers of trading the news…
More about CAD a liter later on. Now it is time to return to the other dollar – Australian, which have been very good to me lately. First a look at the GBP-AUD cross, where I have been looking for a place to buy, if the price dipped under 1.7000 and then created a reversal pattern on 4h chart. It has been over a week since my watch started. At last, on Monday, this trade could be taken.
Entry was at 1.7098, with an objective of 1.7500. No the best patterns to initiate this position, but it was, after all an engulfing bullish line, following a minor double bottom. Also risk was small, just under the latest low, so a little more than 100 pips.
Trade was closed early today at 1.7500. Price moved another 150 higher later on. Now need to see how it behaves around the last high, before I decide on additional trades here.
The trade in AUD-JPY from yesterday, had an objective which was too ambitious. The 150 pips was just not happening and I exited this position at 75.38, for 77 pips. Greed doesn’t pay…. I’m not trading tonight, so no new analysis. Don’t think there is much point in discussing my views if I’m not willing to put money on the line. Besides, no strong convictions emerge right now, so I’m perfectly content to wait for more price development and try to make some decisions then.
Mike K.
Hi,
I have seen your site today while searching in Google. And after seeing your site i have decided to contribute one unique finance article as guest post or interested in healthy content based link deal, if you will allow me.
Please mail me if you are interested in my given mail id…
nancysix00@gmail.com
In return i will also allow your links or unique finance article in my quality finance sites which has good page rank & professional web presence.
Looking forward to see your positive reply.
[...] as an obstacle to higher interest rates. For months now, the RBA has been raising rates while the BoC did it just few days ago. It seems the story for today is no more rate hikes. By the time next week rolls around, who knows? [...]
[...] and the RBA and increased its benchmark rate. The hike was largely symbolic, only 0.25%, but unlike the BoC, the RBNZ seemed to be more optimistic about prospects for future increases. Later, unemployment [...]
[...] Canada and the RBA and increased its benchmark rate. The hike was largely symbolic, only 0.25%, but unlike the BoC, the RBNZ seemed to be more optimistic about prospects for future increases. Later, unemployment [...]
[...] increased its benchmark rate. The hike was largely symbolic, only 0.25%, but unlike the BoC, the RBNZ seemed [...]
Great site. A lot of useful information here. I’m sending it to some friends!