JPMorgan advises to buy CAD against the GBP

JPMorgan advises to buy CAD against the GBP

2020-09-09 • Updated

GBP/CAD keeps falling to the downside amid fears over the no-Brexit deal. According to JPMorgan, the pair will continue dipping throughout the whole of September. The bank has recently given a recommendation to its clients to sell GBP/CAD.

"We tactically sell a basket of EUR & GBP versus CAD, to capture near term risks (ECB, COVID-19) and structural concerns (Brexit, fiscal cliff) while CAD screens as a buy in our growth framework and is relatively underweight", claimed JPMorgan.

The bank forecasts GBP/USD will plummet to 1.29 by the end of the month, and USD/CAD will fluctuate near the 1.31 zone. At the same time, according to it, GBP/CAD may tumble to the three-month low of 1.69. However, the pair is expected to recover some of its losses and reach the 1.75 level by the end of the year.

Going a bit further over Brexit talks, the UK Prime Minister Boris Johnson claimed that the UK Government is going to impose new laws that can nullify some significant issues of the Brexit deal. The EU responded that in this case no trade deal would be done. The deadline to reach an agreement is scheduled for October 15, but both sides stay far apart from making a deal. However, analysts believe that in any case, the UK recovery will be under threat. 

The Canadian dollar is not in the best position either amid falling oil prices, which slumped to levels unseen since July. Nevertheless, it has been performing better than the British pound. All attention now to the Bank of Canada’s rate statement at 17:00 MT time. Analysts anticipate the central bank will leave rates unchanged at the record lows of 0.25% and asset purchases – at 5 billion Canadian dollars per week. If the BOC’s tone is more dovish, the CAD will fall. However, according to Bank of America, the tone of the statement might be more hawkish, which will push the CAD to the upside and, therefore GBP/CAD to the downside.

Check the economic calendar

Technical tips

GBP/CAD is edging lower. The move below the key psychological mark of 1.1700 will drive the pair to the next support of 1.6900. In the opposite scenario, if GBP/CAD surges above the high of July 28 at 1.7300, the doors towards the resistance of 1.7500 will be open. Follow the report and catch the market movement!

GBPCADDaily.png

TRADE NOW

Similar

What will move the market on September 6-10?
What will move the market on September 6-10?

Last Friday’s NFP was disappointing. The reaction of the markets was astonishing. Will it last longer? Let's find out the main trade opportunities for the upcoming week.

S&P in the Сrosshairs
S&P in the Сrosshairs

Institutional investors speak about further growth in the stock market. In the exact market that has doubled since COVID-19 and doesn’t plan to stop. Is it possible?

Pound Sterling’s Foggy Future
Pound Sterling’s Foggy Future

Weaker recoveries were seen in both the UK manufacturing and service sectors, with the latter recording the greatest loss of momentum since July.

Latest news

Omicron Threatens the Markets, but...
Omicron Threatens the Markets, but...

How will the new variant affect the markets and the economy? What is its relationship to inflation and interest rate hikes, and how will it affect those things?

Deposit with your local payment systems

Be on top of your game

Data collection notice

FBS maintains a record of your data to run this website. By pressing the “Accept” button, you agree to our Privacy policy.

Callback

A manager will call you shortly.

Change number

Your request is accepted.

A manager will call you shortly.

Next callback request for this phone number
will be available in

If you have an urgent issue please contact us via
Live chat

Internal error. Please try again later

Don’t waste your time – keep track of how NFP affects the US dollar and profit!

Beginner Forex book

Beginner Forex book will guide you through the world of trading.

Beginner Forex book

The most important things to start trading
Enter your e-mail, and we will send you a free Beginner Forex book

Thank you!

We've emailed a special link to your e-mail.
Click the link to confirm your address and get Beginner Forex book for free.

You are using an older version of your browser.

Update it to the latest version or try another one for a safer, more comfortable and productive trading experience.

Safari Chrome Firefox Opera