Long GBP/CADFundamentals:- the bar on interest rates changed slightly for the U.K. when another member of the MPC voted to hike rates; making the vote 3-0-6. Although we still don't expect a rate hike this year it does bring the tightening of monetary policy into a more realistic curve upward. This could bring the GBP back from its recent sell off against some of the weaker currencies. The Canadian dollar strengthened on Friday along with the Oil price as Opec and Non-OPEC countries met do discuss plans to hike oil production. An increase in production will eventually decrease the value and in turn commodity linked currencies such as the Canadian dollar. In Canada it's self a drop in m/m CPI and m/m retail sales could also bring a near term weaker CAD.
Technicals:- The 4 hour chart shows buyers breaking the resistance line on Thursday then the Oil meetings bringing the price back down to should now become support. The concern is the large pin bar candle which would suggest a much bigger reversal. However, in light of the reason for the spike I am letting it ride. I am looking to jump in on the support level and place stops below the previous candles low on the GBP announcment on Thursday last week. This price also is in confluence with 61% fibonacci pull back.
Looking at the weekly chart below we can see that the uptrend is still underway from 28/05/2018 when we had a pin bar reversal and is still pushing up with larger green candles
And the monthly chart also points to the continuation of the uptrend from September last year.
