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FxWirePro: CAD boosted by hawkish BoC statement, GBP/CAD on track to test trendline support at 1.66, stay short

GBP/CAD chart on Trading View used for analysis

  • The Canadian dollar tumbled post BoC decision, but later pared losses on a hawkish statement that followed.
     
  • As widely expected, the Bank of Canada hiked the policy rate by 25 basis points bringing it to 1.75%.
     
  • The statement that followed was upbeat with the view that the limited spare capacity in the economy will continue to put pressure on prices. 
     
  • The hawkish tone suggests that the central bank looks set to continue on its tightening path.
     
  • Further upside in CAD and hence downside for GBP/CAD on charts. 
     
  • We have advised a short in the pair and our call is approaching TP3. 

Recommendation: Book partial profits at lows, hold for further weakness. 

For details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.  
 

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