Australia and Canada are set to launch high tier financial reads this week, making AUD/CAD a strong pair to observe for potential short-term buying and selling alternatives.

AUD/CAD 1-HR Foreign exchange Chart by TradingView

AUD/CAD might get set to leap round this week with high tier occasions from each the Land Down Underneath and the Nice White North.

In just some hours, Australia is ready to launch their newest CPI learn (forecasted to return in at 7.6% y/y vs. 7.4% y/y earlier), and this might actually get the pair shifting as it might probably have a big affect on the RBA’s  rate of interest expectations.

The next print appears to be priced in in the intervening time, so if it is available in as anticipated or beneath the earlier learn, that might attract Aussie revenue takers or sellers within the short-term. A a lot increased print, although, might doubtlessly push the Aussie increased, in order that’s a possible state of affairs to concentrate on as properly.

The market appears to be consolidating in the intervening time, probably ready for the Australian CPI learn, making a straddle / information commerce sort setup to think about for very short-term merchants on the market.

There are additionally potential performs for longer-term gamers on the market as extra volatility is probably going forward with catalysts from Canada. On Friday, we’ll get the most recent month-to-month learn on Canada’s GDP, anticipated to return in at 0.3% m/m vs. -0.1% m/m earlier.

The Loonie appears to be discovering energy to date this week as properly, and if it continues to rally into the learn on Friday, this may be a possible revenue taking state of affairs for the bulls if the quantity is available in at or beneath expectations.

Regardless of the outcomes of the 2 occasions could also be, we’re on the look out for the market to doubtlessly arrange an opportunity to play the larger theme for AUD/CAD: the financial coverage divergence between the Reserve Financial institution of Australia and the Financial institution of Canada.

Of their newest assembly minutes, the RBA mentioned they might pause mountaineering rates of interest (at present at 3.60%) at their subsequent assembly, whereas the BOC has already paused their fee hike marketing campaign at 4.50% at their final financial coverage assertion.

If the upcoming CPI and retail gross sales information (subsequent week) from Australia assist a fee hike pause, then this may increasingly attract AUD/CAD sellers seeking to play the BOC’s rate of interest differential benefit.

In that state of affairs, a transfer increased and retest of the .9160 – .9200 space is one to observe for bearish reversal patterns for swing merchants seeking to play that individual elementary narrative on AUD/CAD.  At these costs, there’s additionally a strong potential return-on-risk setup if utilizing a break of the swing highs as a cease argument and the current swing lows as a short-term goal.

What do you assume? Is AUD/CAD in your watchlist for both a daytrade setup or a swing commerce? Tell us within the feedback beneath!

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