AUD/CAD
https://www.tradingview.com/x/9qRHDBde
RBA Governor Bullock has suggested that there may be insufficient scope for a rate cut this year. Despite analysts and investors expressing hope for a reduction, no such adjustment has been factored into the market as the RBA maintains a hawkish stance.
Conversely, considering the current inflationary pressures (CPI), we anticipate a dovish approach from the Bank of Canada (BOC), with a rate cut likely to be priced soon. While a potential market correction could be on the horizon, it is expected to be delayed due to the anticipated more aggressive monetary policy from the United States, particularly in light of the US two-year premium.
We are observing multiple rejections at the break and retest zone, which is now acting as support. We will enter a buy position once the price reaches this zone, approximately the 38.2% Fibonacci retracement level. Our target for this trade is slightly below the nearest high.
GBP/CAD
https://www.tradingview.com/x/9qg7FKin
The Bank of England (BOE) is anticipated to cut rates in November, though this has yet to be reflected in market pricing. A significant move is expected in December, which appears increasingly likely, although it has not yet materialized. Until proven otherwise, the BOE is expected to maintain a hawkish stance. Despite ongoing speculation regarding the BOE’s potential weakness, the British pound remains the best-performing currency.
The Canadian dollar (CAD) is expected to exhibit signs of correction, but any such developments are unlikely in the near term due to its strong correlation with the US dollar (USD). We anticipate a more dovish stance from the CAD moving forward.
This entry resembles the AUD/CAD setup, but instead of a high, we are encountering strong resistance. We may consider trailing this entry if we observe robust bullish momentum.