UPDATE: BoC doesn't like the loonie and neither should you
The original trade Idea expected that any Canadian dollar gains from a strong CPI report would be fleeting, as was the case. Yet, the CPI data enabled the second leg of the trade to be triggered and the all-in average rate for the long USDCAD position became 1.0725. USDCAD has struggled to gain momentum above 1.0820. Wednesday's Federal Open Market Committee meeting and US GDP plus Friday's US employment data, risk disappointing markets resulting in a US dollar sell off. It makes sense to sell 1/2 of the position at the current market (1.0810) and raise the stop loss on the balance to 1.0775 guaranteeing a minimum profit of 0.0065 points on trade.
Entry: buy 1/2 USDCAD at market (currently 1.0740), balance at 1.0710.
Time horizon: 3 weeks.
— Edited by Martin O'Rourke
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