Here are the key factors to keep in mind today for British Pound trades:
- UK Retail Sales: Retail sales disappointed forex traders as they showed a 0.3% contraction in January while annualized retail sales rose only 5.4%; this was including auto sales. Economists expected a contraction of 0.2% monthly and an increase of 5.9% annualized. December’s retail sales were revised higher to show an increase of 0.2% monthly and 4.0% annualized. Excluding auto sales retail sales dropped 0.7% in January and rose 4.8% annualized. This missed estimated for a contraction of 0.3% and increase of 5.9%. December’s data was revised higher to show a contraction of only 0.1% and increase of 3.8%. The British Pound was able to hold its advance despite the mixed report.
- UK Public Sector Net Borrowing: The UK borrowed slightly more than expected in January as Public Sector Net Borrowing was reported at £9.4 billion. Economists expected Public Sector Net Borrowing to come in at £9.3 billion which can be compared to December’s Public Sector Net Borrowing of £9.9 billion.
Here is the key factor to keep in mind today for Canadian Dollar trades:
- Canadian Retail Sales: Economists expect Canadian retail sales to plunge 0.4% in December month-over-month including auto sales; excluding auto sales retail sales are expected to plunge 0.8%. The Canadian Dollar could come under fire if expectations are met. December’s expected data can be compared to November’s increase of 0.4% month-over-month and increase of 0.7% respectively.
Should price action for the GBPCAD remain inside the 1.9125 to 1.9175 zone or breakdown below it the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 1.9150
- Take Profit Zone: 1.8000 – 1.8200
- Stop Loss Level: 1.9400
Should price action for the GBPCAD breakout above 1.9175 the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 1.9225
- Take Profit Zone: 1.9400 – 1.9500
- Stop Loss Level: 1.9125
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