On our last trade call this morning we were watching the Canadian Retail Sales, looking for 0.4% in deviation.
This release came out with no deviation at all, so it was a no trade.However, we have a lot of price movement over the past couple of days on the USDCAD. You may note that the EUR, GBP, and the CHF all moved substantially on Monday as the USD strengthened.For instance, the USDCAD made nearly a 200 point move from where it bottomed out to where it topped out yesterday.
Interestingly enough, a lot of folks were looking for a bottom on the USDCAD.In my opinion, I believe that the stretched move we had on the USDCAD long yesterday had a lot of people locking in profits from entries near the bottom. The reversal coming back down to the bottom today was probably a direct result of all those orders.
Many people who were in it long set stops to lock in the profits and it gave the banks an opportunity to come in and clear out all those stops and take in all that profit. I anticipate that they will begin the run up on the Cad very soon and the banks want to take everyone out before the move occurs.
BANK ORDERS IN ACTION
I have been sharing some information about bank orders that I get and haven’t really released it to the free trade calls yet. However, it is probably a good opportunity to talk a little bit about it at this point. We had some bank orders at the .96O8 to .9615 levels, and as you can see the market went right down to that area and bounced off it up to around .9700.
Although there is a possibility that they will lower rates in the US next week, I think we’re still going to see some USD positivity over the coming weeks, at least enough that it will push the USDCAD up several hundred pips and probably see the EUR and the GBP fall as well. We don’t have another live trade call for a few days, so keep an eye out for our next trade call. But for the time being, take a little break.
The video for today’s trade can be seen below.
TRADING OPPORTUNITY TONIGHT
There is an opportunity to trade tonight when the AUD CPI report is released at 9:30 pm EDT.
Your focus should be on the AUD CPI (QoQ) figure, which will be Row 1 of the RSS and is expected to be 0.9%. We have placed a safe trigger of 0.3% for this release. We have seen a deviation of at least 0.3% two out of three times this year, and we have seen moves of at least 50 pips each time.
We will not have the Live Trade Room open, but I wanted to make you aware of this potential trade opportunity.
