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By: Ady Phangestu
GBPCAD – There are no major reports from the Canadian economy so far this week, so volatility is very dependent on the catalysts of the UK economy. The preliminary GDP will be released on Thursday, and it is expected to rebound strongly with a growth of 15.6%.
BOE chief Bailey also has some upcoming speeches and traders are eager to know what the central bank’s next move will be, as the UK government has imposed tougher lockdown measures, which could signal weaker business and consumer activity going forward.
Any indication that the central bank may pursue lower interest rates or buy more assets could bring harm to GBPCAD, likely resulting in a break below the lower channel and a reversal for an uptrend. Crude oil price movements can also bring volatility for GBPCAD, especially if the inventory report shows surprises in both directions. A large draw could signal supported demand, which would be bullish for correlating commodities and currencies, while bulls could bring some downside. GBPCAD is trending higher in the 4-hour time frame as price is testing the channel support. So far, the price has been ranging into its ninth week, a consolidation that is quite tough. The price is still above the midline/upper band with a wavy structure in a channel. The MACD histogram attenuates at the midpoint, a characteristic feature of temporary directionless consolidation.
GBPCAD is trending higher on the 4-hour time frame as the price is testing the channel support. So far, the price has been ranging into its ninth week, a consolidation that is quite tough. The price is still above the midline/upper band, with a wavy structure in a channel. The MACD histogram attenuates at the midpoint, a characteristic feature of temporary directionless consolidation.
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