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25 Feb 2015
Short EUR/CAD and long CAD/JPY more attractive to position for CAD recovery – MP
FXStreet (Barcelona) - Dean Popplewell, Director of Currency Analysis at MarketPulse, notes that medium-term CAD remains bearish as long as $1.2215 holds, but outright positioning for a CAD recovery can be best done by buying CAD/JPY and selling EUR/CAD.
Key Quotes
“The CAD has managed to aggressively rally even since Poloz spoke yesterday as the market focuses on January’s rate cut having brought some time.”
“The obvious shift in sentiment has been fuelled by the “less dovish” than expected BoC. This has led the market to feeling more comfortable re-pricing expectations of another rate cut next week. Prior to yesterday, dealers had priced an 80% of another cut on March 4. Now the majority seems to be “on hold”.”
“The loonie sits atop $1.2450 with a small corporate bias better buyer of USD on dips. Given the overall bullish outlook for the USD, do not be surprised to see more selling of EUR/CAD (€1.4113) and buying of CAD/JPY (¥95.57) as being more attractive than selling USD/CAD outright to position for a CAD recovery.”
“For the techies, the medium term USD/CAD remains bullish as long as $1.2215 remains intact. Yes, it’s a distance, but not far in a crisis.”
Key Quotes
“The CAD has managed to aggressively rally even since Poloz spoke yesterday as the market focuses on January’s rate cut having brought some time.”
“The obvious shift in sentiment has been fuelled by the “less dovish” than expected BoC. This has led the market to feeling more comfortable re-pricing expectations of another rate cut next week. Prior to yesterday, dealers had priced an 80% of another cut on March 4. Now the majority seems to be “on hold”.”
“The loonie sits atop $1.2450 with a small corporate bias better buyer of USD on dips. Given the overall bullish outlook for the USD, do not be surprised to see more selling of EUR/CAD (€1.4113) and buying of CAD/JPY (¥95.57) as being more attractive than selling USD/CAD outright to position for a CAD recovery.”
“For the techies, the medium term USD/CAD remains bullish as long as $1.2215 remains intact. Yes, it’s a distance, but not far in a crisis.”