Short CAD vs. GBP, then USD (from 10-Oct to 27-Oct)
Real-Time AmpGFX – sold USD/CAD to close long (Fri 10/27/2017 8:45 AM MDT)
Sold one unit of USD/CAD at 1.2885
USD/CAD went close to my take-profit and has retreated. I decided to take profit on this part of the long USD trade.
Oil prices continue to climb, and USD/CAD is facing more technical resistance that may cause a pull-back
Positions
Short half unit EUR/USD at 1.1798; s/l 1.1923; t/p 1.1525
Short half unit NZD/USD at 0.7009; s/l 0.7013; t/p 0.6680
Short half unit AUD/USD at 0.7712; s/l 0.7813; t/p 0.7525
Real-Time AmpGFX – order update for USD/CAD (Wed 10/25/2017 8:16 AM MDT)
Positions
Long half unit USD/CAD at 1.2485; s/l 1.2673; t/p 1.2925
Long half unit USD/CAD at 1.2740; s/l 1.2673; t/p 1.2925
Short half unit EUR/USD at 1.1798; s/l 1.1923; t/p 1.1525
Short half unit NZD/USD at 0.7009; s/l 0.7013; t/p 0.6680
Short half unit AUD/USD at 0.7712; s/l 0.7813; t/p 0.7525
Real-Time AmpGFX – bought USD/CAD on BoC statement (Wed 10/25/2017 8:03 AM MDT)
Bought half unit of USD/CAD at 1.2740
Opportunistically, statement much more dovish than expected on initial brush
Real-Time AmpGFX – USD/CAD orders ahead of BoC meeting (Wed 10/25/2017 5:35 AM MDT)
Orders in USD/CAD have been raised in USD/CAD. I am relatively neutral at the moment, but am looking for a bullish USD/CAD reaction to the policy announcement and possibly to an ambivalent press conference. The stop-loss order is raised, but not too close to account for possible whippy wide prices into the event. Take profit at my stretch point for the pair, and may look to trade out of the position soon after the event.
Added a take-profit order for the AUD, lowered NZD stop-loss
Positions
Long half unit USD/CAD at 1.2485; s/l 1.2593; t/p 1.2925
Short half unit EUR/USD at 1.1798; s/l 1.1923; t/p 1.1525
Short half unit NZD/USD at 0.7009; s/l 0.7013; t/p 0.6680
Short half unit AUD/USD at 0.7712; s/l 0.7813; t/p 0.7525
Real-Time AmpGFX – raised USD/CAD take profit order (Fri 10/20/2017 12:28 PM MDT)
The market still has around a 20% change priced in that the BoC will hike rates next week. The odds should be near zero, in my view.
Positions
Long half unit USD/CAD at 1.2485; s/l 1.2393; t/p 1.2770 (raised)
Short half unit EUR/USD at 1.1798; s/l 1.1923; t/p 1.1525
Short half unit NZD/USD at 0.7009; s/l 0.7123; t/p 0.6680
We were stopped out of half the CAD positions on 18-Oct.
Real-Time AmpGFX – bought USD/CAD to add to long position (Tue 10/17/2017 9:16 AM MDT)
Bought half unit USD/CAD at 1.2573
Comment NAFTA negotiations appear to be wide apart and risks are increasingly being built-in to the CAD.
US import price data higher than expected showing impacts of past weakness in USD on prices
US NAHB housing market index rose from 64 to 68, above 64 expected in October.
US yields are creeping higher, USD developing a rising trend this week.
Positions
Long half unit USD/CAD at 1.2485; s/l 1.2393; t/p 1.2660
Long half unit USD/CAD at 1.2573; s/l 1.2513; t/p 1.2770
Short EUR/USD at 1.1798; s/l 1.1923; t/p 1.1525
Real-Time AmpGFX – re-purchased USD/CAD (Fri 10/13/2017 1:55 PM MDT)
Bought half unit USD/CAD at 1.2485
Comment
It has been a whippy day for the USD/CAD.
Surprisingly it bounced to a new high after the lower than expected US CPI report, and now it has fallen back to mid-range.
The 2yr swap rates spread today in USD/CAD is little changed, both US and Canada are down 1.5bp.
After the US CPI data, the UoM Consumer confidence survey was much stronger than expected (although long-term inflation expectations were lower)
Overall the data this week for the USA were solid, except for the CPI. The case for higher US yields is still in place.
The EUR is looking heavy today, QE taper expectations having little positive effect, and fear Catalonia risk coming back with a deadline for Puigdemont to clarify if he is declaring independence on Monday, and then potential disqualification for office on Thursday.
The market appears quite long CAD and EUR. A weaker EUR might help support USD/CAD.
I may look at selling EUR.
Bank of Canada Business survey is due next week. This is important for their rates outlook. With some slowing in other monthly business surveys, and NAFTA negotiations uncertainty, stronger CAD and softer housing market, I expect to see some reversal in the strength in this survey from peak levels In Q2.
Position
Long half unit USD/CAD at 1.2485; s/l 1.2393; t/p 1.2660
Real-Time AmpGFX – sold USD/CAD to close long (Fri 10/13/2017 6:47 AM MDT
Sold one unit USD/CAD at 1.2456
US CPI weaker than expected, USD broadly under pressure and USA yields lower.
Worried that we may see a further significant rout in the USD.
Real-Time AmpGFX – bought USD/CAD (Thu 10/12/2017 6:51 AM MDT)
Bought one unit of USD/CAD at 1.2484
Canadian house price data were seasonally weak.
US core PPI was higher than expected.
NAFTA talks ongoing, this does not appear to have had much impact on CAD this year, but it could turn negative.
We were stopped out of the long GBP/CAD trade on the comments from EU negotiator Barnier that there has not been progress.
Long one unit USD/CAD at 1.2484; s/l 1.2393
Real-Time AmpGFX – bought GBP/CAD (Tue 10/10/2017 9:44 AM MDT)
Bought half unit GBP/CAD at 1.6523
UK economic reports have come out firmer than expected (IP, Construction output), although the trade deficit continues to widen. Unit Labour costs revised up to 3.5%y/y in Q1 (from 2.1), and to 2.4%y/y in Q2 (revised up from 1.6%).
The GBP has been weak in the last week, on heightened political risk that appears to have calmed. The strength in global growth indicators appear to be helping sustain a stronger UK economy, despite Brexit uncertainty, and likely to push the BoE to a hike on 2-Nov (79% priced in)
In contrast, we see the BoC holding rates into next year. The surge in economic growth in the first half of the year appears to have cooled, and the impact of two quick hikes and a stronger CAD are likely to slow activity into year end. The BoC has said it is in data-watching mode for the time being; assessing the impact of its recent hikes.
Long half unit GBP/CAD at 1.6523; s/l 1.6413; t/p 1.6850.