USDCAD Breakout Explained | CAD Weakness, Trade Talks & Key Forex Setups

In our last video, we looked at how a desperate move by the US Treasury to buy more long-dated US bonds hurt USD.

Let’s take a look at the aftermath.

In today’s GCI Market Outlook, let’s take a look at Forex trading on NVIDIA, Gold, XAUUSD, USDCAD, CADCHF, AUDNZD, and AUDUSD.

Just a reminder that these videos are intended as observational and educational, and are not to be considered as trading advice.

We have been following several USD pairs and buying the dip on pairs like AUDUSD when price reaches the lower trend line.

This trend line might be changing now, as global economies are losing confidence in USD.

For example, we often use the stochastic oscillator to signal reversals, with the trend, and we can use ADX to confirm.

When we see the red DI- line quickly turn down, it usually means that the short-term retracement has exhausted itself.

You may have seen our videos on using these indicators to spot price reversals after news events in our News Catalyst Fade, and we may get a chance tomorrow with Australian CPI.

Trading the News Catalyst Fade with ADX and the stochastic oscillator:

https://youtu.be/dGGpel-yZ-8

In general, if yearly CPI comes in lower than 3.3%, this may signal to the RBA that they may not have to raise interest rates this year, which will drive AUD lower, against the trend.

Also, we have US PCE and GDP tomorrow so we will probably see good volatility on AUDUSD, but please check other USD and AUD pairs.

For example, we are in a ranging market looking at the AUDNZD 4-hour chart, and our technicals helped us pick the reversals.

However, the daily chart tells a bit of a different story with AUD looking weaker, contrary to other pairs.

You will note, as well, that all CHF pairs moved last week on news that the SNB will not rule out negative interest rates.

This caused rapid CHF weakness, and the announcement of the US Treasury Bond fiasco caused a reversal, which our indicators spotted nicely.

You will also note a weekend gap on CAD pairs based on the surprise, very unreasonable demands by US trade negotiators over the weekend.

USDCAD saw the same effect and, normally, we would expect a continuation of the downtrend and a gap trade.

However, this is now a fundamental trade, not a technical trade, and the market will be waiting on better news from US/Canada trade talks before we see a stronger Loony.

We see a pullback on Gold.

This is likely just profit-taking, but keep an eye on tomorrow’s US PCE and GDP figures as many analysts feel that gold is still bullish.

And, if you like to trade US equities, we have NVIDIA earnings tomorrow as well, whose share price has been falling for more than one week.

That’s all for now.

CFDs and FX are leveraged products, and your capital may be at risk.