Another Rate Hike Is coming from the Bank of Canada
The Bank of Canada (BoC) is expected to raise interest rates for the second time in a row on Wednesday, reflecting resilient growth, a tight labor market, and persistent underlying inflation. Despite signs of a slowdown, including cooling inflation and a surprise trade deficit, the market anticipates another rate hike. The economy has shown resilience, with the housing market increasing and job additions exceeding expectations in June. According to analysts, the BoC is likely to raise rates by 25 basis points to 5%. Most economists expect the central bank to hold rates steady until well into 2024.
NZDCAD - D1 Timeframe
NZDCAD presents an interesting argument for a bearish continuation. This can be seen from the following factors;
- The drop-base-drop supply zone.
- 50-Day moving average resistance.
- Resistance trendline of the channel.
- The Fibonacci retracement level.
Analyst’s Expectations:
Direction: Bearish
Target: 0.80916
Invalidation: 0.82402
GBPCAD - D1 Timeframe
GBPCAD has made the initial reaction from the weekly pivot zone and the trendline resistance. Since we are expecting a rate hike from the BoC, it simply goes to lend an extra confirmation to the likelihood of a bearish reaction on GBPCAD all the way to the 50-day moving average or the trendline support.
Analyst’s Expectations:
Direction: Bearish
Target: 1.68688
Invalidation: 1.71429
CADJPY - D1 Timeframe
CADJPY is one very volatile commodity and would most likely make the most movement as a result of the news. My target here is the demand zone close to the pivot level at the top of the price movement.
Analyst’s Expectations:
Direction: Bullish
Target: 108.469
Invalidation: 105.295
CONCLUSION
The trading of CFDs comes at a risk. Thus, to succeed, you have to manage risks properly. To avoid costly mistakes while you look to trade these opportunities, be sure to do your due diligence and manage your risk appropriately.
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