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4 Mar 2015
USD/CAD carving a triangle formation, to break higher – BBH
FXStreet (Barcelona) - The Brown Brothers Harriman Team comment on the BoC rate cut expectations and further share the technical outlook for USD/CAD.
Key Quotes
“BOC Governor Poloz dampened expectations for a cut today with last week's reiteration that the January rate cut was an insurance policy to buy time.”
“Yesterday's somewhat firmer than expected Q4 GDP (2.4% vs. 2.0% consensus) should have solidified such expectations, but the details were less encouraging, keeping some wary of a cut today. Inventory accumulation accounted for 0.4 percentage points while the two sectors the central bank has identified as key for the recovery, investment and exports, both fell.”
“The US dollar has been carving out a large triangle pattern against the Canadian dollar since the end of January. The bottom of the triangle is flattish around CAD1.2450. The top is marked by a falling trend line that coming in now near CAD1.2620. We look for an eventual break higher.”
Key Quotes
“BOC Governor Poloz dampened expectations for a cut today with last week's reiteration that the January rate cut was an insurance policy to buy time.”
“Yesterday's somewhat firmer than expected Q4 GDP (2.4% vs. 2.0% consensus) should have solidified such expectations, but the details were less encouraging, keeping some wary of a cut today. Inventory accumulation accounted for 0.4 percentage points while the two sectors the central bank has identified as key for the recovery, investment and exports, both fell.”
“The US dollar has been carving out a large triangle pattern against the Canadian dollar since the end of January. The bottom of the triangle is flattish around CAD1.2450. The top is marked by a falling trend line that coming in now near CAD1.2620. We look for an eventual break higher.”