From the FXWW Chatroom: Trade for the week ahead: Long USDCAD spot, as OPEC could disappoint market
expectations and Canada’s GDP is likely to show a slower pace of activity in Q3.
We believe that the market is pricing in a full extension of OPEC cuts on 30 November, but
we do not expect it to make a final decision until 2018. This is a downside risk, as crude oil
has been supported recently in part by expectations of a renewal. We expect a correction in
crude prices to weigh on oil-related currencies despite the recent weakening in correlation.
In addition, Canada’s GDP is likely to show a slower pace of activity in Q3, weighing on the
CAD. We recommend going long USDCAD (spot ref: 1.2696), targeting 1.2890 with a stoploss
of 1.26 (above the 100-day moving average) for a reward-to-risk ratio of 2:1.
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