The audcad cross is one of the most interesting pairs to be traded as it has a lot of particularities that are not to be found on other pairs. It is also called the commodity cross in the sense that is moving based on two different commodity currencies, namely the AUD and CAD currencies.
The Australian dollar is heavily dependent on the commodity markets so changes in price there are moving the options. One other thing to consider when trading any AUD pair is the economic situation in China as the Chinese counts for almost a binary of Australian exports. In other words, a slowdown in Chine shows a decreasing demand for Australian goods and this translates into a softer AUD as well.
The opposite is true as well, with a strong Chinese demand being the equivalent of a stronger Australian dollar. However, maybe the most important aspect to consider is the fact that the AUDCAD cross is paying a positive swap, and therefore traders interested in the carry trade event are driving the pair.
Just as a side note, a positive swap means that each and every trading day the longs in the pair will receive an interest, or a swap, proportionate with the binary invested in the trade. Because of that, audcad moves are most of the times pointless from a technical analysis point of view and quick spikes in both sides are the name of the game. The economic releases to watch when trading this cross are: To make things even more interesting, the CAD as a currency is strongly binary by the nfp market and oil price changes are reflected by CAD fluctuations.
Therefore, look for changes in oil inventories levels and OPE meetings should be on the list binary the events to watch. AS mentioned above, Australian economy is highly dependent on what is happening with the Chinese economy and with commodity prices so if anything, one should know all the time what the Chinese economy is doing and how gold, platinum, palladium, copper, iron, etc nfp trading as they options have a strong influence on the AUDUSD pair.
Any release above the fifty nfp shows bullish conditions for the sector while a dip below fifty signals troubles as recession is showing its teeth. As mentioned above, everything related to the oil industry, like US rigs count, levels of inventories, OPEC meetingsBinary production levels, etc, are information every USDCAD trader should know when are going to be released as the pair will move sharply on this release.
Ivey PMI in Canada is the only PMI that is nfp when compared with US, Europe and Australia where nfp least two are used and it is important as being a single release it is basically showing the state of the economy, if it is expanding or contracting, with the 50 level being the line in the sand between contraction and expansion, or recession or boom. The classical releases should be watched as well like the Retail Sales, GDP Gross Domestic ProductManufacturing data, etc, but if I choose to pick the most decisive factor besides Bank of Canada interest rate decisions, it will be oil.
Speaking of Bank of Canada, any meeting is being followed by a press conference and during the press conference questions are being asked and therefore volatility is increasing.
Expect a currency pair that is moving somehow with the same speed like the EURGBP cross is moving and if actual is bigger than the forecasted value on the red economic events, then the fall or rise should be sharper, otherwise ranging is mostly common. This website is independent of binary brokers featured on it. Before trading with any of the brokers, potential clients should ensure they understand the risks and verify that the broker is licensed.
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