There is a ray of hope for Crude Oil and by extension the CAD. Other than the speech from Governor Poloz today, we should anticipate CAD bullish momentum to pick up. As observed, any USD weakness helps commodity currencies appreciate and that has been beneficial especially for the CAD. The AUD on the other hand has been on the receiving end because of the slowdown in china and especially the credit risks which is keeping every Chinese regulator on toes. As economic risks swell due to the hot air being pumped into the Chinese financial sector, regulators will initiate steps which will further impeded businesses’ access to credit and Australia as one of the largest trading partner will suffer the brunt.
I’m basing my decisions purely based on price action on this currency pair and I’m bearish AUD. First off, the monthly bearish momentum is picking up and in the daily chart we can see price testing support at 0.994. This will be the 4th time in 3 months and the last time it broke below this level, it found support at 0.9650. So, with trend being set in the monthly and weekly chart-both are bearish, it will be upon us to follow suit and initiate shorts in the lower time frames-the daily chart in my case and trade as follows:
Stop Loss: 1.0080-Recent resistance level.
Take Profit: 0.9650
Traders of this pair should watch out governor Poloz speech.