Currency Analysis Report 9/5/19 – Bank Of Canada Is An Outlier

The trade war between the US and China is wreaking havoc all over the world as evident by the slowing global economy.  Japan has had negative interest rates since 2016.    European policymakers promised to do whatever by any means necessary to avoid deflation. They have been living with negative interest rates for years.  Germany recently sold a 30-year debt at a negative yield for the first time ever.  Financial experts see the Swiss National Bank cutting its rates, which are already negative, even deeper.  Australia and New Zealand are starting to cut their rates.  The US recent cut rates for the first time in 10 years and many experts are saying three more cuts this year. There are even some experts call for negative rates in the US. 

I don’t know any major central bank that isn’t cutting rates or drowning in negative interest rates…that’s until yesterday.

The Bank of Canada met on Weds and decided to keep their interest rates on hold.  This marks the seventh straight meeting they kept rates on hold. Their economy grew at 3.7% annualized in the second quarter.  Investors were expecting their forecast to be dovish, but the Bank didn’t put out a gloomy forecast. On the news, the Canadian dollar went up on the day 0.8%. That might not sound like alot, but in forex, that’s like a double digit move on the stock market. But where is price headed next…lets go to the charts to find out?

Monthly Chart (Curve Time Frame) – monthly supply is 0.7650 and the monthly demand is 0.7452.

Weekly Chart (Trend Time Frame) – based on swing lows and swing highs, the trend is sideways.

Daily Chart (Entry Time Frame) – the chart suggests to play the extremes, thus there is no set-up at this time.

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

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