I have started building a long position at GBP/CAD based on two fundamental views: 1) With the UK economy maintaining impressive momentum, I expect further upbeat data releases this week in form of CPI and employment change, highlighting the fact that the Bank of England could be the second DM central bank to hike interest rates after the RBNZ. 2) The Canadian Dollar has recently strengthened as economic data has caught the market by surprise, leading to a squeeze in an environment where positioning was already crowded. However, I believe that the Bank of Canada will be very cautious and reinforce its dovish message, thus driving the CAD back lower. Given the risk of further dovish comments from Fed Chair Yellen, I prefer to buy GBP/CAD instead of USD/CAD.
I have entered a first, small long near 1.8320 and am looking to add to the position should we see dips towards 1.8280 and 1.8250. A clear break below 1.8150 would make my trade idea invalid and I will fully cover the position. As profit target, I am aiming for 1.8550 as first target (taking half the position off and leaving the remaining 50 % open with a trailed stop).
I have entered a first, small long near 1.8320 and am looking to add to the position should we see dips towards 1.8280 and 1.8250. A clear break below 1.8150 would make my trade idea invalid and I will fully cover the position. As profit target, I am aiming for 1.8550 as first target (taking half the position off and leaving the remaining 50 % open with a trailed stop).